KapStone reports higher annual sales, earnings

KapStone Paper and Packaging Corp. has owneed the landmark Cooper River paper mill in North Charleston since 2008.

KapStone Paper and Packaging Corp., which owns the paper mill along the Cooper River in North Charleston, reported increases of about one-third in both sales and profit during 2014 compared to the previous year.

The Northbrook, Ill,-based manufacturer said it sold $2.3 billion worth of paper, container board and corrugated cardboard products last year — up $553 million from 2013. Net income was $172 million last year, an increase of $45 million over 2013.

The results were released Monday after the stock markets closed.

Roger Stone, chairman and CEO, called the financial performance “transformational” in a written statement.

“We are already seeing improvements in our product mix as we move further into this year and have a sound order backlog,” Stone said.

The improved performance largely was due to the mid-2013 acquisition of Longview, a paper manufacturer in Longview, Wash. Last year was Longview’s first full year of operations under KapStone’s ownership.

KapStone also announced that it completed upgrades to three papermaking machines at the North Charleston mill, which the company bought from MeadWestvaco Corp. in 2008. The upgrades are part of an ongoing $115 million capital improvement project at the Virginia Avenue factory, which employs about 980 workers.

The paper mill is among the five biggest manufacturers in the Charleston region, according to Charleston County, with an annual payroll of about $85 million.

Fourth-quarter financials weren’t as robust as the full year totals, with sales flat compared to the same period in 2013 and net income down 22 percent to $34 million.

Stone said the fourth quarter “is typically a weaker quarter for KapStone,” in part because of annual planned maintenance outages at mills in North Carolina and the South Carolina Upstate along with “unfavorable seasonal impacts.”

He added that the West Coast port congestion and slowdowns “hurt our operations in the fourth quarter and continues to be disruptive.”

Overall, Stone said KapStone’s “balance sheet and cash flow generation are very strong, and we are well-poised and determined to continue to grow this company profitably.”

Reach David Wren at 937-5550 or on Twitter at @David_Wren_