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International Paper (IP) Q3 Earnings & Revenues Top Estimates
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International Paper Company (IP - Free Report) delivered third-quarter 2018 adjusted earnings of $1.56 per share exceeding the year-ago quarter figure of $1.01 per share. The bottom line also outpaced the Zacks Consensus Estimate of $1.47.
Including one-time items, earnings for the quarter under review were $1.37 per share compared with 95 cents per share in the year-ago quarter.
Net sales improved to $5,901 million in the reported quarter from $5,517 million in the year-ago quarter, comfortably surpassing the Zacks Consensus Estimate of $5,898 million.
International Paper Company Price, Consensus and EPS Surprise
Adjusted cost of sales increased 5% year over year to $3,893 million. Adjusted gross profit in the reported quarter was $2,008 million, up 12% from the prior-year quarter. Selling and administrative expenses dipped 0.5% year over year to $405 million. Adjusted operating earnings of $738 million indicated a year-over-year improvement of 9%.
Segment Performance
Industrial Packaging: Sales from this segment increased to $4,034 million from $3,822 million in the year-ago period. Adjusted operating profit improved to $598 million from $505 million in the year-ago quarter.
Printing Papers: Sales from this segment were $1,102million in the reported quarter, up 6% from $1,039 million in the year-earlier quarter. Adjusted operating profit for the segment was $188 million compared with $135 million in the year-ago quarter.
Global Cellulose Fibers: Sales from this segment were $714 million compared with $654 million in the prior-year quarter. The segment’s adjusted operating profit improved 49% to $85 million from the year-ago quarter.
Balance Sheet
As of Sep 30, 2018, cash and temporary investments aggregated $1,026 million compared with $1,018 million as of Dec 31, 2017. Long-term debt was $10,700 million as of Sep 30, 2018 compared with $10,846 million as of Dec 31, 2017.
Cash flow from operating activities for the first nine-month period of fiscal 2018 was $2,405 million compared with $569 million in the prior-year comparable period. Free cash flow for the first nine-month period of fiscal 2018 was $1,119 million compared with $1,238 million in the prior-year comparable period.
Moving Forward
Backed by healthy demand for its products and efforts to offset higher distribution and input costs, the company anticipates delivering a second consecutive year of strong earnings growth in 2018.
International Paper’s shares have lost 31.6% over the past year, compared with the industry’s decline of 16.3%.
The company currently carries a Zacks Rank #4 (Sell).
Methanex has expected long-term earnings growth rate of 15%. Its shares have surged 27% in the past year.
KMG Chemicals has expected long-term earnings growth rate of 28.5%. Its shares have rallied 36% in the past year.
CF Industries has expected long-term earnings growth rate of 6%. Its shares have gained 18% in a year.
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International Paper (IP) Q3 Earnings & Revenues Top Estimates
International Paper Company price-consensus-eps-surprise-chart | International Paper Company Quote
Adjusted cost of sales increased 5% year over year to $3,893 million. Adjusted gross profit in the reported quarter was $2,008 million, up 12% from the prior-year quarter. Selling and administrative expenses dipped 0.5% year over year to $405 million. Adjusted operating earnings of $738 million indicated a year-over-year improvement of 9%.
Segment Performance
Industrial Packaging: Sales from this segment increased to $4,034 million from $3,822 million in the year-ago period. Adjusted operating profit improved to $598 million from $505 million in the year-ago quarter.