DOW JONES NEWSWIRES
Ball Corp.'s (BLL) second-quarter profit rose 33%, helped by a
divestiture gain, but core earnings at the plastic and metal
packaging company also beat expectations amid efforts to align
operations with slumping demand.
Shares rose 3.4% to $49.24. The stock is up 18% this year.
Chairman and Chief Executive David Hoover said he expects 2009
earnings to "exceed" 2008's results and expects "continued
improvement" for the rest of the year. Analysts surveyed by Thomson
Reuters, on average, forecast a 6% increase to $3.83 a share.
Ball has cut costs, shut plants and trimmed inventory amid weak
demand. In May, Moody's Investors Service said effective cost
management had led the U.S. packaging industry to see a rebound in
volume.
Hoover said the latest results "reflect the actions we have
taken over the past 18 months to better align our supply with
demand, a seasonal increase in volumes and better plant performance
throughout our operations."
Ball reported earnings of $133.3 million, or $1.40 a share, up
from $100 million, or $1.02 a share, a year earlier. Excluding
items including the gain from selling a stake in satellite company
DigitalGlobe Inc. (DGI), earnings rose to $1.20 a share from $1.10
a share.
Net sales fell 7.4% to $1.93 billion.
Analysts surveyed by Thomson Reuters were expecting earnings,
excluding items, of $1.08 a share on revenue of $1.97 billion.
Gross margin rose to 17.3% from 16.4%.
Earnings in the metal-beverage packaging segment for the
Americas and Asia - the company's biggest business - fell 3.4% as
sales dropped 10%. Europe had a 16% profit decline as sales
decreased 14%.
In July, Ball said it agreed to acquire four of Anheuser-Busch
InBev NV's (ABI.BT) U.S. plants for $577 million in a deal to add
to Ball's 2010 cash flow and earnings.
-By Mike Barris, Dow Jones Newswires; 212-416-2330;
mike.barris@dowjones.com;