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International Paper (IP) Q4 Earnings Beat Estimates, Up Y/Y
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International Paper Company (IP - Free Report) reported fourth-quarter 2022 adjusted earnings of 87 cents per share, surpassing the Zacks Consensus Estimate of 69 cents by a margin of 26%. The bottom line increased 43% year over year mainly aided by higher sales prices for corrugated boxes. Sales volumes for corrugated boxes and containerboard continued to bear the brunt of lower consumer spending on non-discretionary goods as well as retailer inventory destocking.
Including one-time items, the company posted earnings per share from continuing operations of 48 cents in fourth-quarter 2022 compared with 13 cents in the year-ago quarter. On Jan 24, 2023, IP announced its intention to sell its investment in the Ilim joint venture, subject to regulatory approvals. The company recognized a $533 million impairment charge in the fourth quarter of 2022. Including this charge, the company reported a net loss per share of 90 cents compared with earnings of 28 cents in the last year quarter.
Net sales were $5.13 billion in the quarter under review, up 1% from the year-ago quarter. The top line missed the Zacks Consensus Estimate of $5.18 billion.
International Paper Company Price, Consensus and EPS Surprise
The cost of sales was $3,668 million in the quarter under review, up 0.2% from the prior-year quarter’s $3,659 million. Gross profit increased 3% year over year to $1,465 million.
Selling and administrative expenses were $315 million, which declined 8% from $344 million in the last year’s quarter. Total segment operating profit was $451 million compared with $415 million in the year-ago quarter.
The company realized earnings of $75 million from its Building a Better IP set of initiatives. This brought the year’s tally to $250 million. IP exceed its target of $225 million related to the initiatives.
Segment Performance
Industrial Packaging: The segment’s sales were $4.2 billion, down 2% year on year. Operating profit rose 0.5% year over year to $416 million.
Global Cellulose Fibers: The segment’s sales climbed 17% year over year to $842 million in the fourth quarter. The segment reported an operating profit of $35 million in the quarter, a substantial improvement from the year-ago quarter’s $1 million.
Financial Position
Cash and temporary investments aggregated $804 million at the end of 2022 compared with $1,295 million as of the end of 2021. Throughout the year, the company repurchased shares worth $1.26 billion and paid dividends worth $673 million.
At the end of 2022, its long-term debt was around $4.8 billion compared with $5.4 billion as of 2021-end. Cash flow from operating activities was $2.17 billion in 2022 compared with $2.03 billion in the prior year.
Fiscal 2022 Performance
IP reported adjusted earnings of $3.18 per share in 2022, missing the Zacks Consensus Estimate of $3.70. The bottom line increased 32% year over year. Including one-time items, the company posted earnings per share from continuing operations of $4.74 in 2022 compared with $2.07 in 2021. Net sales increased 9% year over year to $21.2 billion. The top line came in line with the Zacks Consensus Estimate.
Price Performance
Image Source: Zacks Investment Research
International Paper’s shares have fallen 21.7% in the past year, compared with the industry’s 18.4% decline.
Zacks Rank & Other Stocks to Consider
International Paper currently carries a Zacks Rank #3 (Hold).
Top-ranked stocks in the basic materials space include Steel Dynamics, Inc. (STLD - Free Report) , Commercial Metals Company (CMC - Free Report) and Agnico Eagle Mines Limited (AEM - Free Report) .
Steel Dynamics currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for STLD's current-year earnings has been revised 0.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 11.3%, on average. STLD has rallied around 114% in a year.
Commercial Metals currently sports a Zacks Rank of 1. The consensus estimate for CMC's current-year earnings has been revised 9.8% upward in the past 60 days.
Commercial Metals’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 16.7%, on average. CMC has gained around 61% in a year.
Agnico Eagle currently sports a Zacks Rank of 1. The Zacks Consensus Estimate for AEM’s current-year earnings has been revised 0.4% upward in the past 60 days.
Agnico Eagle beat Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.4% on average. AEM’s shares have gained 17% in the past year.
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International Paper (IP) Q4 Earnings Beat Estimates, Up Y/Y
International Paper Company (IP - Free Report) reported fourth-quarter 2022 adjusted earnings of 87 cents per share, surpassing the Zacks Consensus Estimate of 69 cents by a margin of 26%. The bottom line increased 43% year over year mainly aided by higher sales prices for corrugated boxes. Sales volumes for corrugated boxes and containerboard continued to bear the brunt of lower consumer spending on non-discretionary goods as well as retailer inventory destocking.
Including one-time items, the company posted earnings per share from continuing operations of 48 cents in fourth-quarter 2022 compared with 13 cents in the year-ago quarter. On Jan 24, 2023, IP announced its intention to sell its investment in the Ilim joint venture, subject to regulatory approvals. The company recognized a $533 million impairment charge in the fourth quarter of 2022. Including this charge, the company reported a net loss per share of 90 cents compared with earnings of 28 cents in the last year quarter.
Net sales were $5.13 billion in the quarter under review, up 1% from the year-ago quarter. The top line missed the Zacks Consensus Estimate of $5.18 billion.
International Paper Company Price, Consensus and EPS Surprise
International Paper Company price-consensus-eps-surprise-chart | International Paper Company Quote
The cost of sales was $3,668 million in the quarter under review, up 0.2% from the prior-year quarter’s $3,659 million. Gross profit increased 3% year over year to $1,465 million.
Selling and administrative expenses were $315 million, which declined 8% from $344 million in the last year’s quarter. Total segment operating profit was $451 million compared with $415 million in the year-ago quarter.
The company realized earnings of $75 million from its Building a Better IP set of initiatives. This brought the year’s tally to $250 million. IP exceed its target of $225 million related to the initiatives.
Segment Performance
Industrial Packaging: The segment’s sales were $4.2 billion, down 2% year on year. Operating profit rose 0.5% year over year to $416 million.
Global Cellulose Fibers: The segment’s sales climbed 17% year over year to $842 million in the fourth quarter. The segment reported an operating profit of $35 million in the quarter, a substantial improvement from the year-ago quarter’s $1 million.
Financial Position
Cash and temporary investments aggregated $804 million at the end of 2022 compared with $1,295 million as of the end of 2021. Throughout the year, the company repurchased shares worth $1.26 billion and paid dividends worth $673 million.
At the end of 2022, its long-term debt was around $4.8 billion compared with $5.4 billion as of 2021-end. Cash flow from operating activities was $2.17 billion in 2022 compared with $2.03 billion in the prior year.
Fiscal 2022 Performance
IP reported adjusted earnings of $3.18 per share in 2022, missing the Zacks Consensus Estimate of $3.70. The bottom line increased 32% year over year. Including one-time items, the company posted earnings per share from continuing operations of $4.74 in 2022 compared with $2.07 in 2021. Net sales increased 9% year over year to $21.2 billion. The top line came in line with the Zacks Consensus Estimate.
Price Performance
Image Source: Zacks Investment Research
International Paper’s shares have fallen 21.7% in the past year, compared with the industry’s 18.4% decline.
Zacks Rank & Other Stocks to Consider
International Paper currently carries a Zacks Rank #3 (Hold).
Top-ranked stocks in the basic materials space include Steel Dynamics, Inc. (STLD - Free Report) , Commercial Metals Company (CMC - Free Report) and Agnico Eagle Mines Limited (AEM - Free Report) .
Steel Dynamics currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for STLD's current-year earnings has been revised 0.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 11.3%, on average. STLD has rallied around 114% in a year.
Commercial Metals currently sports a Zacks Rank of 1. The consensus estimate for CMC's current-year earnings has been revised 9.8% upward in the past 60 days.
Commercial Metals’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 16.7%, on average. CMC has gained around 61% in a year.
Agnico Eagle currently sports a Zacks Rank of 1. The Zacks Consensus Estimate for AEM’s current-year earnings has been revised 0.4% upward in the past 60 days.
Agnico Eagle beat Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.4% on average. AEM’s shares have gained 17% in the past year.