International Paper swings to loss in 4Q

MEMPHIS, Tennessee - International Paper Co. said Thursday it swung to a fourth-quarter loss, as restructuring, plant closures and other charges offset higher sales.

The top North American maker of cardboard box material also said it is suspending merit raises in 2009 for white-collar employees and will match contributions to employees' savings plan with company stock rather than cash.

International Paper said it lost $452 million, or $1.07 per share, in the quarter ended Dec. 31. It earned $327 million, or 78 cents per share, in the same quarter last year.

Quarterly sales rose 12 percent to $6.54 billion.

The company recorded numerous one-time charges during the last three months of 2008, including restructuring costs, plant shutdowns and goodwill impairment charges related to the company's U.S. and European coated paperboard business. Excluding those items, the company said it earned 21 cents per share.

Wall Street analysts expected 21 cents per share on $6.96 billion in sales, according to a poll by Thomson Reuters. Such estimates typically exclude one-time items.

The company said two of its segments — its printing papers and consumer packaging divisions — posted operating losses for the quarter amid reduced demand for their products. Operating profit in its industrial packaging division, however, rose to $111 million from $109 million, as higher prices offset lower demand.

For the full year, International Paper said net income plunged to $57 million, or 13 cents per share, compared with earnings of $1.17 billion, or $2.70 per share, in 2007. Excluding charges, 2008 earnings came to $2.01 per share. Sales for the year rose 13 percent to $24.83 billion.

Analysts called for a full-year profit $2 per share on sales of $25.24 billion.

Shares of International Paper closed Wednesday at $11.62. The stock has declined by two-thirds from a 52-week high of $33.77 last February.

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