Packaging Corp. of America (PKG), a maker of containerboard and corrugated packaging products, on Monday reported a profit for the first quarter that more than tripled from last year on higher prices and volumes. Both revenue and adjusted earnings per share for the quarter beat analysts' estimates.
Looking ahead to the second quarter, the company forecast earnings below analysts' expectations noting that the majority of the earnings benefit from price increases will not be realized until the third quarter.
Commenting on the first-quarter results, Mark Kowlzan, Chief Executive Officer of Packaging Corp. of America or PCA, said, "We had an outstanding quarter in all aspects of our operations with higher pricing and strong volume driving all-time records for sales, corrugated products shipments and earnings per share. Corrugated products demand was stronger than we expected throughout the quarter, and our mills ran extremely well, allowing us to meet the strong demand while building needed containerboard inventory to help support our mill maintenance outages in the second quarter."
The increase in earnings reflect higher containerboard and corrugated products prices and mix, in addition to higher sales volume and lower recycled fiber costs. These items were partly offset by higher costs including labor and benefits, workers' compensation, energy and transportation.
During the latest quarter, the company's corrugated product shipments per workday rose 7.1 percent compared to last year, while total shipments rose 3.8 percent. Outside sales of containerboard were equal to the year-ago period. Containerboard production totaled 646,000 tons, up 6,000 tons from a year ago.
Lake Forest, Illinois-based Packaging Corp.'s first-quarter net income was $60.6 million or $0.62 per share, up from $17.8 million or $0.18 per share in the year-ago period.
The prior-year quarter's results include biofuel tax credits of $23.0 million or $0.24 per share. Excluding this, adjusted net income for the year-ago quarter was $40.8 million or $0.42 per share.
On average, fourteen analysts polled by Thomson Reuters expected the company to report earnings of $0.56 per share for the latest quarter. Analysts' estimates typically exclude special items.
In the year-ago period, the company amended its 2009 tax return to reduce the gallons claimed as cellulosic biofuel producer credits previously recorded as a tax benefit, and increase the gallons claimed for alternative fuel mixture credits previously recorded as income.
Net sales for the latest quarter grew 12 percent to $755.2 million from $671.3 million in the same period last year. Analysts had a consensus revenue estimate of $722.6 million.
Looking ahead to the second quarter, Packaging Corp. forecasts earnings of about $0.62 per share. Analysts currently estimate earnings of $0.70 per share for the quarter.
Kowlzan added, "Looking ahead, we expect seasonally stronger volume and higher prices in the second quarter. However, the majority of the earnings benefit from price increases will not be realized until the third quarter when our April containerboard price increase pass-through to corrugated products is completed."
PKG closed Monday's regular trading at $43.73, up $0.46 or 1.06 percent on a volume of 1.49 million shares. In after-hours, the stock further gained $0.17 or 0.39 percent to $43.90.
For comments and feedback contact: editorial@rttnews.com
Business News
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.