Graphic Packaging Holding Company reported a net loss for first quarter 2020 of $12.7 million, or a net loss per share of $0.04, based upon 288.9 million weighted average diluted shares. This compares to first quarter 2019 net income of $57.9 million, or $0.19 per share, based upon 298.2 million weighted average diluted shares. First quarter 2020 net income was negatively impacted by a net $103.9 million of special charges including a net $89.7 million non-cash charge related to the settlement of a U.S. pension plan. When adjusting for these charges, adjusted net income for the first quarter of 2020 was $91.2 million, or $0.31 per diluted share. This compares to first quarter 2019 adjusted net income of $61.7 million or $0.21 per diluted share.
Net sales increased 6.2% to $1,599.1 million in the first quarter of 2020, compared to $1,505.9 million in the prior year period. The $93.2 million increase was driven by $14.1 million of higher pricing and $89.0 million of improved volume/mix related to acquisitions and conversions to paperboard packaging solutions. These benefits were partially offset by $9.9 million of unfavorable foreign exchange.
In the earnings report the company announced the planned closure of the 70,000 ton White Pigeon, Michigan CRB mill and the 120,000 ton PM1 containerboard machine in West Monroe, Louisiana. Both closures will be effective June 30, 2020. The CRB mill closure at White Pigeon is enabled by the operating strength of the current CRB mill network and a new CRB supply agreement with Greif, Inc. The closure of the non-core PM1 containerboard machine reflects the company’s long-term confidence in the strength of the CUK global beverage packaging platform and the ability to repurpose existing pulp to support growth in CUK.
The company is also delaying the significant planned maintenance outage at the West Monroe, Louisiana mill from Q2 to Q3 due to increased near-term demand for CUK and contractor work-related implications associated with the COVID-19 crisis.
