Sonoco looks to shape composite can future

Jack Sanders,​ chief executive officer and president, said they were optimistic about the opportunities, during a conference call on the firm’s Q2 results.

“As far as shape containers, we still have some very strong work going on and some interest there. ​

“We're looking at technology that exists in other areas of the world and looking at how we apply that back to the North American market and what new products we could actually put into a unique shape can, powdered-stuff like flour, something like that.”​

Mixed fortunes​

Composite cans unit demand increased 1.7% in North America in the Consumer segment but volume was flat overall despite a 2% increase in flexibles' trade volume and 7% in blow-molded plastics.

This was offset by a decline in the trade sales of metal ends and lower sales in thermoformed and injection-molded plastics.

Second quarter 2013 sales for the Consumer Packaging segment were $475m, compared with $477m in 2012 and segment operating profit was $47.4m against $42.8m in Q2 2012.

Segment operating profit increased 11% due to a positive price/cost relationship and productivity improvements, which were partially offset by higher labor, pension and other operating costs.

Sonoco said another drag on productivity came from blow-molded plastics, due to unusual items, including the impact of the tornado on the St. Louis plant and a mechanical failure with one blow-molding wheel.

Lower selling prices​

The Paper and Industrial Converted Products segment reported Q2 2013 sales of $473m, compared with $475m in 2012 and segment operating profit was $36m against $39.7m in 2012.

The decrease in sales was due to lower selling prices associated with the year-over-year decline in recovered paper costs, partially offset by volume gains across most of the segment.

One exception was European recycling where volume was down due to exiting a small recycled fiber trading operation inGreece, said the firm.  

Operating profits declined 9% year over year as modest productivity, volume and price/cost improvements were more than offset by higher maintenance, labor, pension and other costs.

Volume growth in Protective Solutions​

Protective Solutions segment sales were $149m, compared with $142m in Q2 2012 and operating profit was $12.1m, compared with $11.7m in Q2 2012.

This segment's quarterly sales improved 5% due to volume growth throughout the segment, primarily in the Industrial and Consumer protective businesses, offset by the divestiture of a small box plant.

Operating profit for the segment increased 4% due to productivity improvements, volume growth and a slightly positive price/cost relationship, offset by a negative mix of business and higher labor and other operating costs.