Gross profits were $221 million in the 4Q, up 8%, compared with $204 million in the same period in 2012. Gross profit as a percent of sales improved to 18.2%, compared with 17.3% in the same period in 2012. This improvement was due to strong productivity gains, volume growth and a positive price/cost relationship, partially offset by higher maintenance, labor and other costs. The Company's 4Q selling, general and administrative expenses increased 14% to $127 million due primarily to wage inflation and higher management incentives, compared with the previous year.
Commenting on the Company's 4Q results, Sonoco President and CEO Jack Sanders said, "Sonoco concluded the final quarter of 2013 with slightly better than expected results compared to the prior year quarter, helped by a lower than expected effective tax rate. That said, the Company did achieve improved volume, particularly in our consumer-focused businesses, along with strong productivity and a positive price/cost relationship. These positive factors were partially offset by higher labor, operating and other costs."
"Operating profits from our Consumer Packaging segment increased 21% over the prior year's fourth quarter due to volume gains in most of the businesses in the segment, along with strong productivity and a positive price/cost relationship, partially offset by higher labor and other operating expenses. In addition, operating profits from our Display and Packaging segment improved slightly."
"4Q operating profits declined 8% in our Paper and Industrial Converted Products segment as strong productivity improvements, modest volume growth and insurance proceeds were more than offset by higher labor, maintenance and other operating costs, and an increase in profits deferred on intercompany paper sales. Operating profits in our Protective Solutions segment also declined during the fourth quarter as the benefit of improved productivity was more than offset by a negative price/cost relationship and higher labor and other operating expenses, including costs associated with the start up of new operations."
Net sales for 2013 were $4.85 billion, up just over 1%, compared with $4.79 billion in 2012. Volume growth in the Display and Packaging, Protective Solutions and Paper and Industrial Converted Products segments and higher sales prices, were partially offset by the closure of the Company's European recycling operations, the sale of a small box plant and lower volume in Consumer Packaging.
Net income attributable to Sonoco for 2013 was $219.1 million, or $2.12 per diluted share, up 12%, compared with $196 million, or $1.91 per diluted share, in 2012. Earnings in 2013 were negatively impacted by after-tax restructuring and other charges of $18.4 million, or $.18 per diluted share, compared with $30.9 million, or $0.30 per diluted share, in 2012, primarily resulting from restructuring and other charges, net of gains from property sales and insurance recoveries, and income tax charges relating to the repatriation of offshore cash.
Sonoco is a global provider of a variety of consumer packaging, industrial products, protective packaging and packaging supply chain services.