NEW YORK, NY, Westvaco Corporation (NYSE: W) today announced that earnings per share for the 2001 first quarter ending January 31 are expected to be in the range of 30-35 percent lower than last year's first quarter earnings of 50 cents per share.
"Reflecting the softening U.S. economy, we are seeing more than seasonal weakness in economically sensitive markets including printing and direct mail markets for coated papers, as well as certain folding carton markets served by our bleached board mills," said John A. Luke, Jr., Chairman and CEO.
Volumes are lower in both the bleached board and coated paper markets with resulting downward pressure on price realizations. In coated paper markets, the strength of the U.S. dollar has affected volumes and pricing. Market related downtime at Westvaco's two bleached board mills is expected to reduce production by about 30,000 tons during the first quarter and maintenance costs will be higher for the quarter as the company accelerates some maintenance projects to coincide with downtime. Higher fuel costs will also affect profitability in the first quarter relative to last year.
Westvaco's Brazilian operations expect stronger results in the first quarter of 2001 compared to last year's quarter due to a healthy Brazilian economy and a strong product offering. Markets for high value consumer packaging for media, pharmaceutical, health care and cosmetic packaging products, which Westvaco entered through acquisitions last year, continue to be healthy.
The company will report first quarter results on February 27, 2001.
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