DELAWARE, Ohio (AP) ¿ Greif Inc. said Wednesday its fiscal second-quarter profit and sales fell sharply as the recession cut into demand for its industrial packaging products. But Greif said it saw signs of improvement in its markets as the quarter ended, and reaffirmed its full-year earnings forecast. Greif reported net income for the three months ended April 30 of $12.1 million, or 21 cents per Class A share, down from a profit of $48.7 million, or 82 cents per Class A share, in the year-ago period. Excluding restructuring and inventory charges and debt retirement, the Delaware, Ohio-based company posted a profit of 53 cents per Class A share. On that basis, the performance narrowly beat the expectations of analysts surveyed by Thomson Reuters, who expected a profit of 51 cents per share, on average. Analysts' estimates typically exclude one-time items. Greif posted sales of $647.9 million, down 29 percent from $918 million in the year-ago period. Excluding the impact of foreign currency, sales were down a more modest 20 percent.
The results fell short of analysts' consensus forecast of $748 million. Greif attributed the sales decline to soft demand from customers because of the recession. But Chairman and Chief Executive Michael Gasser said his company expects to help offset the weak market conditions through a previously announced cost-cutting plan that's expected to yield at least $100 million in fiscal 2009 savings. Gasser also said he was encouraged "that there were increased signs of improvement in our markets as we exited the quarter." Gasser reaffirmed its full-year expectations for a profit of $3.25 to $3.75 per Class A share in fiscal 2009. Analysts expect a full-year profit of $3.30 per share, on average. Greif released fiscal second-quarter results after its shares closed down $1.25, or about 2.5 percent, to $48.51. The stock has traded in a 52-week range of $25.65 to $73.45.