Greif Profit Falls, Misses Estimates; Reaffirms FY Guidance

(RTTNews) - Greif Inc (GEF, GEF_B), an industrial packaging products company, on Wednesday reported first-quarter net earnings of $30.1 million or $0.52 per Class A share compared with $30.7 million or $0.53 per share last year.

Excluding items, adjusted earnings for the quarter were $0.30 per share compared with $0.46 per share a year ago.

Revenues for the quarter were $902.3 million compared with $1 billion in the prior year.

Analysts polled by Thomson Reuters estimated earnings of $0.37 per share on revenues of $955 million for the quarter. Analysts' estimates typically exclude special items.

CEO David Fischer said results were hurt by foreign currency translation, divestitures, as well as product and geographic mix issues resulting in lower gross profit, a higher tax rate and lower results in the flexible packaging business.

Fischer said that during the past few quarters, the company has been selling non-core businesses and since the beginning of the first quarter 2015, closed and divested four plants located primarily in North America, APAC and Europe. Fischer said the actions are expected to make positively contribute to results in the second half of this year.

For the full year 2015, the company still expects adjusted earnings of $2.25 to $2.35 per share, while analysts expect $2.33 per share.

Greif said it expects a modest recovery in 2015, with positive aspects of the improving economy in the United States being offset by the negative trends in other regions, particularly in Europe and Latin America.

Foreign currency would continue to be a challenge, and an expected two-week shutdown of its Riverville mill during the third quarter for the installation of upgrades will negatively impact 2015 net income, the company said.

On March 3, the company's board declared quarterly cash dividends of $0.42 per share of Class A Common Stock and $0.63 per share of Class B Common Stock.