Greif (GEF) Cuts FY12 EBITDA Outlook; Q3 Volume Below Expectations

August 15, 2012 7:34 AM EDT
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Greif, Inc. (NYSE: GEF) announced revised guidance for fiscal 2012, which ends on Oct. 31, 2012. EBITDA (earnings before interest, taxes, depreciation and amortization) is expected to be $445 million - $465 million compared with the company's previous guidance of $500 million - $525 million. This decrease is primarily due to lower than expected volumes.

Third quarter 2012 volumes for the company's rigid industrial packaging and flexible products businesses were below expectations primarily due to softer than anticipated market conditions. While there are some signs of market firming in Europe, it is occurring at a slower pace than the company expected earlier this year, and it appears that rigid packaging markets in other regions of the world are now being impacted. In addition, the geographic mix of earnings will result in a higher book tax rate for third quarter 2012 than the company had previously

The economic conditions noted above are expected to also impact fourth quarter 2012 results and have been included in this revised fiscal 2012 guidance.

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