MeadWestvaco Corp.'s (MWV) first-quarter profit soared on broad revenue growth, led by gains in packaging and specialty chemicals, which helped bottom line results top analysts' expectations.
After suffering from slumping demand during the recession, the packaging and specialty chemicals maker moved to cut costs and shed jobs, efforts that have helped improve gross margins in recent quarters. Adjusted earnings grew in each quarter of 2010, helped by higher sales.
MWV reported earnings of $65 million, or 38 cents a share, up from $24 million, or 14 cents a share, a year earlier. Excluding restructuring charges in the latest quarter and other impact, adjusted earnings from continuing operations grew to 43 cents from 13 cents, while revenue climbed 8.2% to $1.37 billion.
Analysts surveyed by Thomson Reuters expected a profit of 23 cents on revenue of $1.39 billion.
Gross margin improved to 23.2% from 18.3%.
Sales from the company's packaging resources segment, its largest by revenue, climbed 9%. Sales at the consumer solutions and consumer and office products units were up 2% and 4%, respectively. Specialty chemicals sales jumped 28%.
In February, the company completed the sale of its envelope products group to Cenveo Inc. (CVO) in an effort to streamline its consumer and office products business. Terms of the sale weren't disclosed.