Packaging Corporation of America (PCA) has registered a net income of $183.2m during the third quarter (Q3) of 2023, down by 30.2% from $262.5m in Q3 2022. 

Excluding special items, PCA’s net income for Q3 2023 was $185m or $2.05 per share.

This decline in net income excluding special items can be attributed to factors such as lower prices, mix, and volumes in PCA’s Packaging segment, as well as higher depreciation expenses and lower volumes in its Paper segment. 

These items were partly offset by lower operating costs, lower converting costs, lower scheduled maintenance outage costs, and lower freight and logistics expenses, among others.

During this quarter, which ended on 30 September 2023, the company’s basic and diluted earnings per share stood at $2.04 and $2.03, respectively. 

PCA’s net sales in Q3 2023 totalled $1.9bn, representing a decline of 8.8% from $2.1bn in the previous year’s Q3.

Specifically in the Packaging segment, the company saw a 9.3% decline in sales from $1.9bn in Q3 2022 to $1.7bn in this year’s Q3. 

Its Paper segment’s sales also decreased by 4.4% to $157.9m from $165.3m in Q3 last year. 

In the reported quarter, the company’s gross profit was $412.7m versus $518.4m in Q3 2022.

PCA chair and CEO Mark W Kowlzan said: “Looking ahead as we move from the third and into the fourth quarter, in our Packaging segment, we expect less market-related downtime as we build our inventories back to appropriate levels along with higher shipments per day in our corrugated products facilities, although our plants will have one less shipping day compared to the third quarter. 

“We also expect lower average prices primarily due to the majority of the May decrease in the published benchmark index grades being realised throughout the third quarter as well as a seasonally less rich mix. 

“In our Paper segment, volume will be lower compared to the seasonally stronger third quarter, and prices and mix are assumed to trend lower with declines in the index prices. 

“Considering these items, we expect fourth-quarter earnings of $1.76 per share.”