Bemis Food Packaging Sales Fall on Weaker U.S. Economy

Flexible packaging maker Bemis reported a 3 percent fall in sales for 2007, largely due to weaker consumer demand for packaged food in its core market.

The company said it had had a "challenging year" and expected 2008 to be "equally as challenging."

"We did not anticipate the negative impact that the current economic environment would have on consumer demand for food products in 2007 in the United States," said Jeffrey Curler, Bemis chief executive.

Higher energy and food prices, and in some cases, increased housing-related costs associated with mortgage market issues are squeezing consumer's budgets, said Curler. 

On top of slower sales, Bemis is also expecting raw material cost increases during the first half of the coming year. It plans to pass on the higher raw material costs through higher selling prices "as rapidly as possible."

In flexible packaging, which accounts for more than 80 percent of the firm's sales, sales and profits were buoyed by currency benefits and restructuring.

Excluding both factors, the firm actually saw lower sales volumes across a number of markets while operating profit fell by more than 5 percent to $346.6 million.

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