Diversey acquisition drives Sealed Air record Q4 sales results
The US-based firm reported a 66% increase in Q4 revenue through the acquisition of Diversey, a solutions provider to the cleaning and sanitisation market.
Total revenue in Q4 increased 70% year on year to $2.05bn (€1.58bn) and improved food packaging net sales of $546.6m (€420.5m) in Q4 saw a rise by 2% year-on-year.
North American volumes decreased slightly, but this was partially offset by growth in Latin America and Europe. Food packaging operating profit declined 3% year on year to $76.2m (€58.6m).
Operating profit down
Sales in the food solutions segment increased by 5% and operating profit was steady at $28m (€22m),but margins decreased slightly to 10.6% of net sales, compared with 11.2% in 2010.
Reporting financial results for the year ending 31 December 2011, the packaging giant revealed net sales growth of 26% to $5.64bn (€4.34bn) - with an 18% increase related to the acquisition of Diversey contributing to the increase.
Operating profit for the year was $447m ($344m) compared with $535m (€412m) in 2010.
On an adjusted basis, operating profit was $631m (€485m) compared with $561m (€432m) in 2010.
Solid performance in challenging environment
William V. Hickey, president and CEO of Sealed Air said: “Our results for the fourth quarter reflect solid performance in our legacy Sealed Air business in a challenging economic environment, coupled with the successful completion of our Diversey acquisition.
“In the legacy businesses, our continued focus on our strategic growth programs, developing region expansion and margin improvement helped to drive improved free cash flow above expectations, strengthening our ability to pay down debt and drive earnings growth going forward,” Hickey added.
“Despite inflationary pressures and slower volume growth, we once again achieved year-over-year quarterly earnings growth in our legacy business.
“We also made significant progress in the integration of the Diversey business during the quarter, with the identification of significant incremental cost synergies that will enhance our ability to generate value for the combined enterprise in 2012 and beyond.”
Sealed Air said it remained cautious heading into 2012, given tepid economic growth and higher raw material costs.
“Okay, let me say that our January numbers are slightly up. I would say slightly up, it's been a slower start to the year, which you would expect after December. But again, the first quarter tends to be our slowest quarter,” Hickey added.
