SIG revenue growth driven by non-European markets

By Joseph James Whitworth

- Last updated on GMT

Related tags United states dollar

Reynolds Group Holdings quarterly report
Reynolds Group Holdings quarterly report
Revenue for SIG grew to $560m as markets outside Europe remained strong for the three month period ending 30 June.

The firm reported revenue increased by $40m, or 8%, compared to $520m for the three month period ending 30 June 2012.

Revenue in the rest of the world increased by $49m, or 20%, to $298m due to $44m from higher sales volume and product mix due to stronger demand in all regions and a favorable foreign currency impact of $5m.

However, in Europe there was a decrease by $9m to $262m driven by $13m of lower sales volume and product mix, partially offset by a favorable foreign currency impact of $4m due to the weakening of the dollar against the euro.

Results were reported as part of Reynolds Group Holdings which owns SIG, Evergreen, Closures and Graham Packaging. Pactiv Food Service and Reynolds Consumer Products are also part of the group.

The firm’s revenues increased by $16m to $3.613bn compared to $3.597bn in the three month period.

Graham Packaging sales down

Graham Packaging’s revenues decreased by $25m, or 3%, to $791m because of a decrease in sales volume of $25m due to the rationalization of unprofitable products and market softness in product categories, such as isotonics and enhanced waters, partially offset by growth in Graham Packaging's emerging markets.

Revenue was also impacted by favorable product mix, mostly offset by a decrease in resin pricing passed through to customers.

Closures sales suffer

Revenues in the Closures segment decreased by $19m, or 5%, to $328m due to a lower sales volume, which decreased revenue by $12m. Decreased customer demand in North America came as a result of market conditions and increased local competition in South America.

There was an unfavorable foreign currency impact of $9m, due to the strengthening of the dollar against the Japanese yen, Brazilian real and Argentine peso, offset by the strengthening of the Mexican peso against the dollar.

These decreases were partially offset by a net increase in revenue of $2m resulting from changes in pricing related to the pass-through of resin price changes to customers and product mix.

Cartons up for Evergreen

Revenue decreased by $13m to $408m attributable to a $14m decrease in sales volume of paper products and a $10m decrease in sales of liquid packaging board, partially offset by an $11m increase in sales of cartons.

Decrease in sales of paper products was due to lower market demand and in liquid packaging board was due to $7m in lower sales volume and an impact of $3m in price decreases.

Increase in sales of cartons was due to an increase of $9m in sales volume, driven primarily by higher demand in both North America and Asia, and $2m in price increases.

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