Bemis Company, Inc. (BMS - Free Report) is expanding its Asia-Pacific foothold with the purchase of Foshan New Changsheng Plastics Films Co. (NCS). Financial terms of the transaction were not disclosed.
Headquartered in China, Foshan New Changsheng Plastics Films is a specialty film manufacturer. The company manufactures PE PP (Polyethylene & Polypropylene) films used for food, medical lamination packaging, PE films for process and Terminal protecting of electronic products.
The acquisition will provide Bemis an opportunity to enhance its presence in the Asia Pacific region which is in line with its long-term strategy. The acquisition, however, will not affect the earnings projections of the company for 2013.
Bemis, in 2011, acquired Mayor Packaging in China, which provided it a high-barrier footprint focused on the growing food packaging market in the region. The company has also embarked on an aggressive cost reduction program by closing nine facilities and moving the production to other facilities.
Bemis, which belongs to the packaging and containers industry along with Berry Plastics Group, Inc. (BERY - Free Report) , AptarGroup, Inc. (ATR - Free Report) and Graphic Packaging Holding Company (GPK - Free Report) , reported its first quarter 2013 adjusted earnings of 53 cents per share, up 8% from the year-ago quarter. The results beat the Zacks Consensus Estimate by a penny. The company’s revenues slid 4% year over year to $1.2 billion, due to lower unit sales volumes.
Weak volume, a cautious consumer spending environment, weakening European economic outlook and rising food costs remain major causes of concern. However, savings from the cost reduction program due to the closure of unproductive facilities will help offset these pressures.
Neenah, Wis.-based Bemis is a global manufacturer of flexible packaging products and pressure sensitive materials sold primarily to the food industry. The company also sells its products to other customers in the chemical, agri-business, medical, pharmaceutical, personal care, electronics, automotive, construction, and graphic industries.
Bemis currently retains a Zacks Rank #3 (Hold).