Financial report: Bobst posts 5.4% increase in sales in H1 FY23 as International Paper’s net earnings drop by 54% in Q2 FY23

SWITZERLAND – Bobst has posted a 5.4% increase in sales in H1 FY23, up by 5.4% as International Paper registers a drop of 54% in its net earnings in Q2 FY23.

The Swiss company has posted consolidated sales of SFr815 million (US$938.92m) in the first half (H1) of 2023, up by 5.4% from SFr773m in H1 2022.

This includes net sales of SFr498.9 million (US$574.76m) in the company’s Printing & Converting business unit and SFr315.7 million (US$363.70) in its Services & Performance unit.

The company said this increase in consolidated sales during the first six months of the year, which ended on 30 June 2023, can be attributed to the high machine backlog at the start of the year.

Higher sales were also driven by no restrictions on travel and the absence of Covid-19-induced lockdowns.

Bobst’s operating result or earnings before interest and taxes (EBIT) totaled SFr46.8 million (US$53.92m). This represents an increase of 18.2% from the EBIT of SFr28.6 million (US$32.95m) during the same period in 2022.

This increase in EBIT was due to improved margins, higher sales, and enhanced cost absorption, resulting from a less negative impact on the company’s overall operational performance. 

The net result during the reported period reached SFr41.3 million (US$47.58m) versus SFr21.6 million (US$24.88m) a year ago. This increase was due to higher EBIT recorded in H1 this year.

The company said it recorded a decline of 22% in its order entries in H1 this year while its order backlog decreased by 5% compared with H1 2022.

Bobst is now expecting ‘a good second half of the year’, mainly due to its service activities and high backlog.

The company is estimating this year’s net sales to be similar to that of the full-year 2022, which amounted to SFr1.8 billion (US$2.07bn), with a comparatively lower EBIT margin than 2022.

International Paper’s net earnings decrease by 54% in Q2 FY23

International Paper has posted a 54% decrease in its net earnings to US$235m during the second quarter (Q2) of 2023, compared to US$511m in Q2 financial year 2022 (FY22).

The adjusted operating earnings (generally accepted accounting principles) for the reported quarter, which ended on 30 June 2023, totaled US$204m or $0.59 per diluted share.

The company’s net sales for the reported quarter in FY23 stood at US$4.68bn, representing a decline of 13.1% from US$5.38bn during the same period a year ago.

The highest net sales of US$3.88bn were achieved in International Paper’s Industrial Packaging segment, followed by its Global Cellulose Fibers and Corporate and Inter-segment, with US$698m and US$100m achieved, respectively.

The operating profit in the Industrial Packaging segment declined to US$304m in Q2 FY23 while the same was US$322m in the first quarter of this year and $560m in Q2 FY23.

International Paper has attributed this decline in figures to lower sales prices in North America, amidst continued soft demand for corrugated boxes and containerboard, as the destocking of its customers’ inventory also continued.

In the case of its Global Cellulose Fibers segment, the paper and pulp company registered an increase in operating profits from US$25m in Q2 FY22 to US$30m in Q2 FY23.

This increase, which comes in spite of lower fluff pulp sales and decreased pulp pricing, was driven due to improvement in supply chain conditions, lower operating costs, as well as planned maintenance costs and input costs.

In this quarter, the company was able to return US$200m to its shareholders, which included US$160m in dividends.

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