Greif Inc. (GEF, Financial) filed Quarterly Report for the period ended 2009-04-30.
Greif Brothers Corp. manufactures and markets a broad variety of superior quality industrial shipping containers (which include fibre drumsplastic drums steel drums intermediate bulk containers and multiwall bags) and containerboard and corrugated products (which include semichemical and recycled medium recycled linerboard corrugated boxes and corrugated honeycomb products) as well as timber properties. Greif provides innovative packaging solutions to meet the ever-changing needs of its customers. (PRESS RELEASE) Greif Inc. has a market cap of $2.27 billion; its shares were traded at around $48.68 with a P/E ratio of 14.49 and P/S ratio of 0.6. The dividend yield of Greif Inc. stocks is 3.12%. Greif Inc. had an annual average earning growth of 16.1% over the past 10 years. GuruFocus rated Greif Inc. the business predictability rank of 4-star.
Self-Insurance. We are self-insured for certain of the claims made under our employee medical and dental insurance programs. We had recorded liabilities totaling $4.2 million and $4.1 million of estimated costs related to outstanding claims at April 30, 2009 and October 31, 2008, respectively. These costs include an estimate for expected settlements on pending claims, administrative fees and an estimate for claims incurred but not reported. These estimates are based on our assessment of outstanding claims, historical analysis and current payment trends. We record an estimate for the claims incurred but not reported using an estimated lag period based upon historical information. This lag period assumption has been consistently applied for the periods presented. If the lag period were hypothetically adjusted by a period equal to a half month, the impact on earnings would be approximately $1.0 million. However, we believe the liabilities recorded are adequate based upon current facts and circumstances.
Net sales decreased 29 percent (20 percent excluding the impact of foreign currency translation) to $647.9 million in the second quarter of 2009 compared to $918.0 million in the second quarter of 2008. The $270.1 million decline was due to Industrial Packaging ($220.9 million), Paper Packaging ($45.3 million) and Timber ($3.9 million). The 20 percent constant-currency decrease was due to lower sales volumes across all product lines.
Operating profit was $30.3 million and $81.5 million in the second quarter of 2009 and 2008, respectively. Operating profit before the impact of restructuring charges, restructuring-related inventory charges and timberland disposals, net, was $58.1 million for the second quarter of 2009 compared to $88.7 million for the second quarter of 2008. The $30.6 million decrease was due to Industrial Packaging ($23.5 million) and Timber ($8.0 million), partially offset by an increase in Paper Packaging ($0.9 million).
Operating profit was $13.6 million in the second quarter of 2009 compared to operating profit of $57.9 million in the second quarter of 2008. Operating profit before the impact of restructuring charges and restructuring–related inventory charges decreased to $40.7 million in the second quarter of 2009 from $64.2 million in the second quarter of 2008. The segment is aggressively implementing plans through the Greif Business System and specific contingency actions to mitigate the impact of the lower activity levels.
Operating profit was $14.3 million and $13.2 million in the second quarter of 2009 and 2008, respectively. Operating profit before the impact of restructuring charges increased to $15.0 million in the second quarter of 2009 from $14.1 million in the second quarter of 2008. The increase was primarily due to lower raw material costs, especially old corrugated containers, labor and transportation costs, partially offset by lower sales volumes. In addition, the segment is aggressively implementing plans through the Greif Business Systems and specific contingency actions to mitigate the impact of the lower activity levels.
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Greif Brothers Corp. manufactures and markets a broad variety of superior quality industrial shipping containers (which include fibre drumsplastic drums steel drums intermediate bulk containers and multiwall bags) and containerboard and corrugated products (which include semichemical and recycled medium recycled linerboard corrugated boxes and corrugated honeycomb products) as well as timber properties. Greif provides innovative packaging solutions to meet the ever-changing needs of its customers. (PRESS RELEASE) Greif Inc. has a market cap of $2.27 billion; its shares were traded at around $48.68 with a P/E ratio of 14.49 and P/S ratio of 0.6. The dividend yield of Greif Inc. stocks is 3.12%. Greif Inc. had an annual average earning growth of 16.1% over the past 10 years. GuruFocus rated Greif Inc. the business predictability rank of 4-star.
Highlight of Business Operations:
Environmental expenses were insignificant for the six months ended April 30, 2009 and 2008. Environmental cash expenditures were $0.4 million and $1.1 for the six months ended April 30, 2009 and 2008, respectively. Our reserves for environmental liabilities at April 30, 2009 amounted to $32.8 million, which included reserves of $18.2 million related to our blending facility in Chicago, Illinois (a reduction of $3.3 million from January 31, 2009 due to expenditures made and a reduction in cost estimates by a third party for its remediation efforts), and $9.0 million related to our Blagden facilities. The remaining reserves were for asserted and unasserted environmental litigation, claims and/or assessments at manufacturing sites and other locations where we believe it is probable the outcome of such matters will be unfavorable to us, but the environmental exposure at any one of those sites was not individually material. Reserves for large environmental exposures are principally based on environmental studies and cost estimates provided by third parties, but also take into account management estimates. Reserves for less significant environmental exposures are principally based on management estimates.Self-Insurance. We are self-insured for certain of the claims made under our employee medical and dental insurance programs. We had recorded liabilities totaling $4.2 million and $4.1 million of estimated costs related to outstanding claims at April 30, 2009 and October 31, 2008, respectively. These costs include an estimate for expected settlements on pending claims, administrative fees and an estimate for claims incurred but not reported. These estimates are based on our assessment of outstanding claims, historical analysis and current payment trends. We record an estimate for the claims incurred but not reported using an estimated lag period based upon historical information. This lag period assumption has been consistently applied for the periods presented. If the lag period were hypothetically adjusted by a period equal to a half month, the impact on earnings would be approximately $1.0 million. However, we believe the liabilities recorded are adequate based upon current facts and circumstances.
Net sales decreased 29 percent (20 percent excluding the impact of foreign currency translation) to $647.9 million in the second quarter of 2009 compared to $918.0 million in the second quarter of 2008. The $270.1 million decline was due to Industrial Packaging ($220.9 million), Paper Packaging ($45.3 million) and Timber ($3.9 million). The 20 percent constant-currency decrease was due to lower sales volumes across all product lines.
Operating profit was $30.3 million and $81.5 million in the second quarter of 2009 and 2008, respectively. Operating profit before the impact of restructuring charges, restructuring-related inventory charges and timberland disposals, net, was $58.1 million for the second quarter of 2009 compared to $88.7 million for the second quarter of 2008. The $30.6 million decrease was due to Industrial Packaging ($23.5 million) and Timber ($8.0 million), partially offset by an increase in Paper Packaging ($0.9 million).
Operating profit was $13.6 million in the second quarter of 2009 compared to operating profit of $57.9 million in the second quarter of 2008. Operating profit before the impact of restructuring charges and restructuring–related inventory charges decreased to $40.7 million in the second quarter of 2009 from $64.2 million in the second quarter of 2008. The segment is aggressively implementing plans through the Greif Business System and specific contingency actions to mitigate the impact of the lower activity levels.
Operating profit was $14.3 million and $13.2 million in the second quarter of 2009 and 2008, respectively. Operating profit before the impact of restructuring charges increased to $15.0 million in the second quarter of 2009 from $14.1 million in the second quarter of 2008. The increase was primarily due to lower raw material costs, especially old corrugated containers, labor and transportation costs, partially offset by lower sales volumes. In addition, the segment is aggressively implementing plans through the Greif Business Systems and specific contingency actions to mitigate the impact of the lower activity levels.
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