Appleton Papers’ sales and earnings drop in Q2

Appleton Papers has reported second quarter 2012 net sales of $213.9 million, a decrease of 1.2% compared to second quarter 2011 net sales, and a quarterly operating loss of $32.5 million.

The company’s overall sales slumped despite an increase in its thermal papers segment, where an 8.6% increase in net sales nearly offset sales decreases in carbonless papers and Encapsys.

While adjusted operating income was up $6.3 million, or 59%, over the second quarter of 2011, the company reported a second quarter operating loss of $32.5 million, compared to operating income of $10.7 million in the same period of 2011. The loss was largely the result of $42.9 million of costs related to ceasing papermaking operations at the West Carrollton, Ohio mill, and transitioning to base paper produced by Domtar as part of the 15-year supply agreement announced in February.

Appleton Papers also had $6.5 million in transaction costs associated with the proposed business combination between Appleton and Hicks Acquisition Co. On July 13, the two companies announced they would discontinue the proposed merger.

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