Graphic Packaging Holding Company (NYSE:GPK) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.
Graphic Packaging Holding Company Earnings Cheat Sheet
Results: Adjusted Earnings Per Share increased 66.67% to $0.10 in the quarter versus EPS of $0.06 in the year-earlier quarter.
Revenue: Rose 3.12% to $1.1 billion from the year-earlier quarter.
Actual vs. Wall St. Expectations: Graphic Packaging Holding Company reported adjusted EPS income of $0.10 per share. By that measure, the company beat the mean analyst estimate of $0.08. It missed the average revenue estimate of $1.13 billion.
Quoting Management: “Our first quarter results were in line with our expectations as we grew our business and expanded our margins in what remains a sluggish operating environment,” said CEO David Scheible. “Volumes in our core legacy folding carton business increased in the quarter. Both new product commercializations and new customers over the past year drove the volume increase despite soft demand in some core end markets like soft drink and cereal. Undoubtedly, weather impacted demand for some products, but high unemployment and fuel prices are the more important factors negatively affecting demand for our products. These factors force end consumers to tightly manage discretionary spending, and we must continue to adapt our business accordingly. Our first quarter results benefited from strong manufacturing performance at our mills driven by improvement initiatives in energy, operating efficiencies and fixed costs. These initiatives generated a significant increase in output from a year ago and contributed to $23 million of total net performance improvements in the quarter.”
Key Stats (on next page)…
Revenue increased 4.48% from $1.05 billion in the previous quarter. EPS increased 25% from $0.08 in the previous quarter.
Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.13 to a profit $0.14. For the current year, the average estimate has moved up from a profit of $0.45 to a profit of $0.48 over the last ninety days.
Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.
(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)