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Bemis (BMS) Earnings Beat, Revenues Miss Estimates in Q1

Zacks Equity Research

Bemis Company, Inc. BMS reported first-quarter 2019 adjusted earnings per share of 67 cents, which improved 6% year over year. The bottom line also beat the Zacks Consensus Estimate of 66 cents.

Including one-time costs, Bemis reported earnings of 66 cents per share compared with 52 cents in the prior-year quarter.

Bemis Company, Inc. Price, Consensus and EPS Surprise
 

Bemis Company, Inc. Price, Consensus and EPS Surprise

Bemis Company, Inc. price-consensus-eps-surprise-chart | Bemis Company, Inc. Quote

Operational Update

Net sales were down 2.5% to $1,001 million from $1,027 million reported in the year-ago quarter. The figure missed the Zacks Consensus Estimate of $1,002 million.

Cost of products sold declined 3.6% year over year to $799 million in the January-March quarter. Gross profit rose 2% year over year to $202 million. Gross margin came in at 20.2% during the first quarter of 2019 compared with 19.3% in the year-ago quarter.

Selling, general and administrative expenses of $97 million from remained flat with the year-earlier quarter. Adjusted operating income increased 5% year over year to $95.4 million.

Segmental Performance

Net sales in the U.S. Packaging segment improved 0.4% year over year to $669 million. The segment’s operating profit rose 5% to $92 million from $87 million in the prior-year quarter.

Net sales in the Latin America Packaging segment declined around 16% year over year to $142 million. The segment’s operating profit improved 47% to $11.9 million from year-ago quarter’s figure of $8.0 million.

Net sales in the Rest of World Packaging segment were down 1% year over year to $190 million. This segment’s operating profit increased 22% to $20.1 million from $16.5 million in the prior-year quarter.

Financial Update

Bemis reported cash and cash equivalents of $57.7 million at the end of the first quarter of 2019, down from $76.1 million reported at the end of 2018. Cash flow from operations was $1.5 million in the first quarter of 2019, compared with $54.3 million recorded in comparable period last year.

Bemis’ net debt increased to $1.35 billion as of Mar 31, 2019, from $1.28 billion as of Dec 31, 2018.

Bemis & Amcor Merger

In August 2018, Amcor and Bemis announced the plan to merge their operations in an all-stock transaction worth $6.8 billion. The merger will create a global leader in consumer packaging. This merger will provide $180 million of cost synergies identified as part of the transaction.

Share Price Performance

Bemis' shares have gained 27.9% in the past year, outperformed the industry’s growth of 0.1%.

Zacks Rank & Key Picks

The company currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Industrial Products sector are DMC Global Inc. BOOM, Lawson Products, Inc. LAWS and DXP Enterprises, Inc. DXPE, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

DMC Global has an estimated earnings growth rate of 77.3% for the ongoing year. The company’s shares have soared 128.6% in the past year.

Lawson Products has an expected earnings growth rate of a whopping 102.5% for the current year. The stock has appreciated 33.4% in a year’s time.

DXP Enterprises has a projected earnings growth rate of 21.6% for 2019. The company’s shares have gained 21.4%, over the past year.

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