International Paper Company (IP) has reported a 37.43 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $209 million, or $0.50 a share in the quarter, compared with $334 million, or $0.81 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $249 million, or $0.60 a share compared with $330 million or $0.80 a share, a year ago.
Revenue during the quarter grew 7.85 percent to $5,511 million from $5,110 million in the previous year period. Gross margin for the quarter contracted 83 basis points over the previous year period to 28.51 percent. Total expenses were 93 percent of quarterly revenues, up from 92.11 percent for the same period last year. That has resulted in a contraction of 88 basis points in operating margin to 7 percent.
"International Paper delivered a solid first quarter in the face of several challenges, including the digester incident at our Pensacola mill and higher input costs driven by a significant rise in OCC prices," said Mark Sutton, chairman and chief executive officer. "Given the market fundamentals across most of our businesses in combination with several IP commercial and operational initiatives, we expect improved results pointing to a particularly strong second half as well as positive momentum entering 2018. I remain very confident in IP's ability to generate significant year-over-year earnings growth and continued strong cash flow in 2017."
Operating cash flow improves marginally
International Paper Company has generated cash of $633 million from operating activities during the quarter, up 2.10 percent or $13 million, when compared with the last year period.
The company has spent $400 million cash to meet investing activities during the quarter as against cash outgo of $364 million in the last year period. It has incurred capital expenditure of $373 million on net basis during the quarter, up 23.92 percent or $72 million from year ago period.
The company has spent $284 million cash to carry out financing activities during the quarter as against cash outgo of $164 million in the last year period.
Cash and cash equivalents stood at $998 million as on Mar. 31, 2017, down 13.59 percent or $157 million from $1,155 million on Mar. 31, 2016.
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