Smurfit-Stone posts strong earnings and cash flow

Smurfit-Stone Container Corporation reported net income of $65 million, or $0.65 per diluted share, for the third quarter ended Sept. 30, 2010, compared with net income attributable to common stockholders of $1.41 billion, or $5.41 per diluted share, for the second quarter of 2010, and $65 million, or $0.25 per share, for the third quarter of 2009.

Smurfit-Stone’s third quarter 2010 adjusted net income was $76 million, or $0.76 per diluted share, up from adjusted net income of $2 million, or $0.01 per diluted share, in the second quarter of this year, and an adjusted net loss of ($23) million, or ($0.09) per diluted share, in the third quarter of 2009. The adjustments in the third quarter of 2010 were primarily the exclusion of costs related to reorganization and restructuring. The major adjustment in the second quarter of 2010 was the exclusion of $1.42 billion of income, including tax benefits, related to the Company’s emergence from bankruptcy.

The Company reported operating income of $142 million for the third quarter of 2010, compared to an operating loss of ($6) million in the second quarter of 2010, and operating income of $159 million in the third quarter of 2009. The sequential improvement in operating income reflects increased net sales in the third quarter due to higher selling prices, lower maintenance-related downtime, lower fiber costs, and cost savings achieved in mill and container operations. Third quarter 2009 operating income significantly benefitted from income related to the alternative fuel tax credits that were received in 2009.

Net sales for the third quarter of this year were $1.63 billion, up 4.5 percent from $1.56 billion in the second quarter of 2010 and up 15.3 percent over sales of $1.42 billion in the third quarter of 2009. The improvement in third quarter 2010 net sales is primarily due to higher average selling prices during the quarter.