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Bemis (BMS) Beats on Q4 Earnings by a Penny; Sales Lag
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Bemis Company, Inc. reported fourth-quarter 2016 adjusted earnings per share of 67 cents, up around 12% year over year. Earnings beat the Zacks Consensus Estimate by a penny. Including one-time costs, earnings came in at 64 cents per share compared with 58 cents reported in the prior-year quarter.
The company’s shares fell around 0.7% to $49.47 after the company posted its fourth-quarter 2016 results on Jan 26.
Operational Update
Net sales increased to $988 million from $982.7 million in the year-ago quarter. Revenues also fell short of the Zacks Consensus Estimate of $1,023 million.
Bemis Company, Inc. Price, Consensus and EPS Surprise
Cost of products sold inched up 0.3% year over year to $772 million in the quarter. Gross profit increased 1.3% to $215.6 million from $212.9 million in the prior-year quarter. Gross margin expanded 10 basis points (bps) to 21.8% in the quarter. Selling, general and administrative expenses decreased 10.5% to $96.6 million from $107.9 million in the year-ago quarter. Adjusted operating income rose 13% year over year to $107 million. Adjusted operating margin advanced 130 bps to 10.9% in the quarter.
Segment Performance
Net sales at the U.S. Packaging segment dipped 3.6% year over year to $632 million. The decrease in net sales was due to the mix of products sold. Segment operating profit was up 0.5% to $94 million from $93.5 million in the prior-year quarter.
Net sales at the Global Packaging segment climbed 8.8% year over year to $356 million. Currency translation had an impact of 4%, while acquisitions contributed 7.6%. Excluding the impact of currency translation and acquisitions, net sales jumped 5.3%, reflecting increased sales price. Unit volumes remained flat year over year. Segment operating profit was up 19% to $33.4 million from $28 million in the year-ago quarter.
Financial Update
At the end of 2016, Bemis generated cash and cash equivalents of $74 million, which increased from $59 million at the end of 2015. Cash flow from operations came in at $437.4 million in 2016 compared with $552.4 million in the prior year.
At the end of 2016, Bemis’ total debt increased to $1,545 million, compared with $1,389 million at the end of 2015. During the reported quarter, the company repurchased 1 million shares for $48.5 million. As of the quarter end, the remaining Board authorization for the repurchase of stock was 20.4 million shares.
2016 Performance
Bemis reported adjusted earnings per share of $2.69 in 2016, up 5.5% from $2.55 per share recorded in the prior year. Earnings outpaced the Zacks Consensus Estimate of $2.68 per share. Including one-time items, the bottom line came in at $2.48, up 0.4% from $2.47 recorded in 2015.
Revenues edged down 1.7% year over year to $4 billion from $4.07 billion in 2015. The top line also missed the Zacks Consensus Estimate of $4.04 billion.
Guidance
Bemis projects adjusted earnings per share to be in the range of $2.85–$3.00 in 2017. Management continues to expect cash from operations to be in the range of $440–$480 million and capital expenditures to be approximately $200 million for full-year 2017.
Share Price Performance
In the last one year, Bemis has underperformed the Zacks classified Containers & Glass sub-industry with respect to price performance. The stock gained 4.8%, while the industry rose 31.9% over the same time frame.
Zacks Rank
Bemis currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the same sector are ABB Ltd , Altra Industrial Motion Corp. and Apogee Enterprises, Inc. (APOG - Free Report) .
Altra Industrial Motion also boasts a Zacks Rank #1 and has delivered an average positive earnings surprise of 8.06% in the trailing four quarters. Apogee, another Zacks Rank #1 stock, has an average positive earnings surprise of 13.24% for the past four quarters.
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Bemis (BMS) Beats on Q4 Earnings by a Penny; Sales Lag
Bemis Company, Inc. reported fourth-quarter 2016 adjusted earnings per share of 67 cents, up around 12% year over year. Earnings beat the Zacks Consensus Estimate by a penny. Including one-time costs, earnings came in at 64 cents per share compared with 58 cents reported in the prior-year quarter.
The company’s shares fell around 0.7% to $49.47 after the company posted its fourth-quarter 2016 results on Jan 26.
Operational Update
Net sales increased to $988 million from $982.7 million in the year-ago quarter. Revenues also fell short of the Zacks Consensus Estimate of $1,023 million.
Bemis Company, Inc. Price, Consensus and EPS Surprise
Bemis Company, Inc. Price, Consensus and EPS Surprise | Bemis Company, Inc. Quote
Cost of products sold inched up 0.3% year over year to $772 million in the quarter. Gross profit increased 1.3% to $215.6 million from $212.9 million in the prior-year quarter. Gross margin expanded 10 basis points (bps) to 21.8% in the quarter. Selling, general and administrative expenses decreased 10.5% to $96.6 million from $107.9 million in the year-ago quarter. Adjusted operating income rose 13% year over year to $107 million. Adjusted operating margin advanced 130 bps to 10.9% in the quarter.
Segment Performance
Net sales at the U.S. Packaging segment dipped 3.6% year over year to $632 million. The decrease in net sales was due to the mix of products sold. Segment operating profit was up 0.5% to $94 million from $93.5 million in the prior-year quarter.
Net sales at the Global Packaging segment climbed 8.8% year over year to $356 million. Currency translation had an impact of 4%, while acquisitions contributed 7.6%. Excluding the impact of currency translation and acquisitions, net sales jumped 5.3%, reflecting increased sales price. Unit volumes remained flat year over year. Segment operating profit was up 19% to $33.4 million from $28 million in the year-ago quarter.
Financial Update
At the end of 2016, Bemis generated cash and cash equivalents of $74 million, which increased from $59 million at the end of 2015. Cash flow from operations came in at $437.4 million in 2016 compared with $552.4 million in the prior year.
At the end of 2016, Bemis’ total debt increased to $1,545 million, compared with $1,389 million at the end of 2015. During the reported quarter, the company repurchased 1 million shares for $48.5 million. As of the quarter end, the remaining Board authorization for the repurchase of stock was 20.4 million shares.
2016 Performance
Bemis reported adjusted earnings per share of $2.69 in 2016, up 5.5% from $2.55 per share recorded in the prior year. Earnings outpaced the Zacks Consensus Estimate of $2.68 per share. Including one-time items, the bottom line came in at $2.48, up 0.4% from $2.47 recorded in 2015.
Revenues edged down 1.7% year over year to $4 billion from $4.07 billion in 2015. The top line also missed the Zacks Consensus Estimate of $4.04 billion.
Guidance
Bemis projects adjusted earnings per share to be in the range of $2.85–$3.00 in 2017. Management continues to expect cash from operations to be in the range of $440–$480 million and capital expenditures to be approximately $200 million for full-year 2017.
Share Price Performance
In the last one year, Bemis has underperformed the Zacks classified Containers & Glass sub-industry with respect to price performance. The stock gained 4.8%, while the industry rose 31.9% over the same time frame.
Zacks Rank
Bemis currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the same sector are ABB Ltd , Altra Industrial Motion Corp. and Apogee Enterprises, Inc. (APOG - Free Report) .
ABB Ltd has delivered an average positive earnings surprise of 23.50% in the last four quarters. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Altra Industrial Motion also boasts a Zacks Rank #1 and has delivered an average positive earnings surprise of 8.06% in the trailing four quarters. Apogee, another Zacks Rank #1 stock, has an average positive earnings surprise of 13.24% for the past four quarters.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>