Sealed Air Q4 profit plummets

The company’s net sales fell by 7% to $1.2bn in the fourth quarter of 2008 as a result of a $87m reduction in unit volumes, primarily in its protective packaging business.

The protective packaging business reported a 14% fall in fourth-quarter net sales to $339m due to lower volumes in North America and Europe.

Its food packaging business posted a 3% fall in net sales to $503m, excluding unfavourable exchange rate charges, net sales would have increased by 3%.

Sealed Air said that its marketing, administrative and development expenses had decreased to $172m.

The company reported a 49% decline in full-year net earnings, but saw net sales increase by 4% to $4.7bn in the year.

The company revealed that it incurred $20m of restructuring charges in 2008, mainly due to the closure of its Cedar Rapid site in Iowa.

It expects to incur around $30m in total restructuring expenses this year, but will realise cost savings of $45m in 2009 and $55m in 2010.

William V. Hickey, president and chief executive, said: “Although market conditions negatively impacted our revenue, our operating results reflected the proactive steps we took earlier in the year to manage our business in these challenging times.

“We worked on improving our cash flow, invested less capital as our new capacity projects neared completion and reduced consolidated net debt by $91m.”

The company, which operates in 52 countries, manufactures recognised brands such as Bubble Wrap, Jiffy protective mailers, Instapak foam-in-place systems and Cryovac packaging technology.

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