Packaging Corp misses quarterly profit estimates on higher costs
Oct 22 (Reuters) - Packaging Corp of America PKG.N missed Wall Street expectations for third-quarter profit on Wednesday, hit by subdued demand amid economic uncertainty and higher costs, sending its shares down more than 7% in after-hours trading.
The Lake Forest, Illinois-based company, which provides paper and packaging products, has been grappling with higher freight rates and slowing demand as a result of trade uncertainties due to tariffs.
"We expect seasonally higher energy and fiber costs and, on the whole, freight and other operating costs to be relatively flat. In the Paper segment, we expect lower production and sales volumes than the seasonally stronger third quarter with flat pricing," CEO Mark Kowlzan said.
The company posted a third-quarter adjusted profit of $2.73 per share, compared with the estimates of $2.81, according to data compiled by LSEG.
Packaging Corp's net sales rose to $2.31 billion, above analysts' average estimate of $2.30 billion.
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