Bemis' product strategy paying off with record earnings per share

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Bemis Co. Inc. Henry Theisen

Bemis Co. Inc. is feeling good about itself these days as the flexible packaging and pressure sensitive materials firm is posting record earnings per share.

Bemis, based in Neenah, Wis., earned 65 cents per share, or $65.8 million, for the second quarter ended June 30 compared with earnings of 51 cents per share, or $53.1 million, during last year’s second quarter.

The company had revenue of $1.242 billion during the second quarter, down from $1.297 billion during last year’s same period.

“Our business teams continue to focus on serving customers, increasing market share and improving sales mix where our technologies provide a sustainable advantage,” Chief Operating Officer William F. Austen said on a conference call July 24 to discuss earnings.

“Our strategy to sell the right products is paying off,” CEO Henry Theisen said. Providing new, innovative products are earning the company higher prices “based on the value they add to our customers.”

“We grew our target dairy and liquid end markets consistent with our strategy to increase sales in high-barrier, value-added products,” he said. “In our liquid packaging business, we continue to see the positive impacts of the conversion away from historical formats such as glass and metal cans to our lighter and more sustainable flexible packaging.”

The company’s U.S. packaging segment had sales of $725.8 million during the second quarter, down 7.1 percent from the second quarter of last year. Divestitures accounted for 6.6 percent of that decrease with 0.5 percent coming from lower volumes in what the company described as “less differentiated product categories.”

The company’s global packaging sales were $371.8 million, a decrease of 0.7 percent from last year’s second quarter. That included a 5.8 percent decrease due to currency translation and a 5.2 percent increase from an acquisition in China.

Pressure sensitive materials sales were $144 million, up 1.6 percent quarter-over-quarter, the company said.

Bemis also increased the lower end of its 2014 earnings guidance from $2.40 to $2.45 per share. The upper end remains at $2.55 per share.

“While volume is important, our main focus remains in selling value added products to our customers,” Austen said.

“We strategically increased unit sales to liquid, diary and health care packaging end markets. We are pleased with this targeted growth and with the work we have done to lay the foundation for continued success in the coming periods,” he said.