Sonoco (SON -3.4%) reported Q4 sales growth of 13.7% Y/Y; Consumer packaging segment sales +14.3% Y/Y to $554.2M, display and packaging +25.8% Y/Y to $142.4M, paper and industrial +14.2% Y/Y to $471.1M, protective solutions flat Y/Y at $131.3M.
Overall operating margin declined by 10% due to one-time asset impairment charges in Q4 2017 and one time gain on business disposition in Q4 2016. Consumer segment operating margin improved 60 bps to 11.9%; paper and industrial improved 320 bps to 9.4% and protective services declined 280 bps to 6.9%.
FY2018 Guidance: EPS $3.16-3.26; tax rate 26-27%; Operating cash flow of $560-580M and free cash flow $180-200M.
"Inflationary cost pressures in freight, labor, energy and material costs are requiring us to raise prices for many of our products starting the year. In addition, negative trends in packaged food and grocery store sales could remain a headwind as consumers focus on fresh and natural alternatives and expanding e-commerce option," said CEO Jack Sanders.
Previously: Sonoco Products misses by $0.01, beats on revenue (Feb. 15)
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