RockTenn recently reported earnings for the quarter ended September 30, 2010 of $2.31 per diluted share. The Company's adjusted earnings were $1.64 per diluted share compared to the prior year quarter adjusted earnings of $1.19 per diluted share.
Net sales of $806.8 million for the fourth quarter of fiscal 2010 increased $77.8 million, or 10.7% over the fourth quarter of fiscal 2009.
Segment income of $125.9 million was $18.4 million, or 17.1% over the prior year quarter excluding $21.4 million of alternative fuel mixture credit, net of expenses in the prior year quarter.
In the fourth quarter of fiscal 2010 we elected to claim the cellulosic biofuel producer credit for black liquor produced in calendar year 2009 instead of the alternative fuel mixture credit. Accordingly, we recorded a cellulosic biofuel producer credit, net of interest and previously claimed alternative fuel mixture credit, of $27.6 million, or $0.71 per diluted share, as a reduction of income tax expense. The cellulosic credit is a taxable credit of $1.01 per gallon as compared to the $0.50 per gallon non-taxable alternative fuel mixture credit.
RockTenn's pre-tax restructuring and other costs, net of related noncontrolling interest, were $2.4 million, or $0.04 per diluted share after-tax, for the fourth quarter of fiscal 2010 consisting primarily of plant closing related asset impairments.
The effective tax rate for the fourth quarter of fiscal 2010, excluding the cellulosic biofuel producer credit, was 32.8%. Our normalized tax rate is approximately 35%. The impact of the lower 32.8% tax rate in the fourth quarter of fiscal 2010 increased earnings by $2.1 million, or $0.05 per diluted share. The lower effective tax rate was due primarily to the recognition of certain tax credits and reductions in reserves for uncertain tax positions.
RockTenn Chairman and Chief Executive Officer James A. Rubright stated, "RockTenn's adjusted earnings of $1.64 per share increased 38% over the prior year quarter due to volume growth of 2% and higher operating margins, driven by continued operational excellence and higher product prices. Overall demand continued to be strong early in the December quarter and we believe that if current demand and recycled fiber costs continue at current levels throughout the fiscal year, adjusted earnings in fiscal 2011 will exceed adjusted earnings in fiscal 2010."
