Graphic Packaging Holding Company, a leading provider of packaging solutions to food, beverage and consumer product companies, recently reported Net Income for first quarter 2017 of $37.0 million, or $0.12 per share, based on 314.1 million weighted average diluted shares. This compares to first quarter 2016 Net Income of $57.5 million, or $0.18 per share, based on 324.2 million weighted average diluted shares.
First quarter 2017 Net Income was negatively impacted by $5.7 million (net of a $2.9 million tax benefit) of business combinations and other special charges. When adjusting for these charges, Adjusted Net Income for the first quarter of 2017 was $42.7 million, or $0.14 per diluted share. This compares to first quarter 2016 Adjusted Net Income of $64.6 million or $0.20 per diluted share.
"Our first quarter Adjusted EBITDA was lower as expected at $161 million compared to $193 million in the prior year period. Net sales were up 2.7%, reflecting recent acquisitions and stable core volumes, consistent with the trends we experienced in 2016. Operating efficiencies improved during the quarter and we successfully upgraded two headboxes on the number six paper machine at our West Monroe, Louisiana mill" said President and CEO Michael Doss. "The quarter was negatively impacted by accelerating commodity input costs, primarily recycled fiber, and the planned downtime costs associated with the upgrade of the two headboxes."
"We are executing price increases to offset the unprecedented recycled fiber input cost inflation we are experiencing and expect margins to improve from our pricing actions during the second half of 2017, and in 2018. Our focus on meeting cash flow commitments, growing cash flow, and returning more of it to stockholders over time has not changed. We returned $64 million to stockholders in the first quarter of 2017 through dividends and share repurchases. We remain committed to a balanced capital allocation strategy, which includes reinvesting in our business to drive strong cash returns on cash invested, strategic acquisitions at compelling post-synergy multiples, and returning cash to stockholders through dividends and share repurchases."
