Sonoco's net sales for the 3Q 2016 were $1.21 billion, down $33.9 million, or 2.7%, from last year’s quarter. The decline in sales was a result of the previously reported discontinuation of the Company's contract packaging business in Irapuato, Mexico; lower selling prices, primarily linked to lower raw material costs; and divested businesses.
Gross profits were $235.4 million in the 3Q 2016, up $6 million, compared with $229.4 million in the same period in 2015. Gross profit as a percent of sales improved to 19.5%, compared with 18.5% in the same period in 2015.
Sonoco President and CEO Jack Sanders said: “Sonoco achieved better than anticipated financial results driven by record results from our Consumer Packaging segment along with continued improvement in our Paper and Industrial Converted Products segment. Overall, compared to the prior year quarter, the Company's earnings benefited from gains from fixed-cost productivity, a positive price/cost relationship, manufacturing productivity and lower pension and post-retirement benefit costs. Offsetting these positive factors were higher labor, maintenance and other operating costs while overall volume was essentially flat for the quarter.”
For the first nine months of 2016, net sales were $3.64 billion, down $56.6 million, compared to $3.70 billion in 2015.
Current year-to-date gross profit was $722.6 million, up 4.7%, compared with $690.1 million in the first three quarters of 2015, largely due to a positive/price cost relationship and gains in volume/mix. Gross profit as a percent of sales was 19.8%, up 119 basis points, from 18.7% in 2015.
Sonoco is a global provider of a variety of consumer packaging, industrial products, protective packaging, and displays and packaging supply chain services.
