International Paper reported third quarter 2019 financial results. Third quarter net earnings were $344 million ($0.87 per diluted share) compared with $292 million ($0.73 per diluted share) in the second quarter of 2019 and $562 million ($1.37 per diluted share) in the third quarter of 2018. Third quarter adjusted operating earnings were $431 million ($1.09 per diluted share) compared with $460 million ($1.15 per diluted share) in the second quarter of 2019 and $641 million ($1.56 per diluted share) in the third quarter of 2018. Third quarter cash provided by operations were $882 million and year-to-date of $2.7 billion compared with $2.4 billion year-to-date in the same period of 2018.
Industrial Packaging operating profits in the third quarter of 2019 were $510 million ($535 million excluding special items) compared with $507 million ($515 million excluding special items) in the second quarter of 2019. In North America, earnings increased due to improved demand for boxes and export containerboard, lower planned maintenance outage expenses and lower input costs, primarily for recycled containerboard and wood. Earnings were negatively impacted by lower export containerboard prices and seasonally higher manufacturing operations. In Europe, earnings improved driven by higher average margins and favorable manufacturing operations which benefited from continued improved performance at the Madrid, Spain mill, partially offset by seasonally lower volumes, primarily in Morocco.
Ilim joint venture equity earnings were $18 million in the third quarter of 2019 compared with $67 million in the second quarter of 2019. Operationally, earnings decreased driven by lower export sales prices for hardwood pulp, softwood pulp and containerboard to China and other export markets. Sales volumes also decreased due to planned outages at the Bratsk, Koryazhma and Ust-Ilimsk mills. The Company recognized a non-cash after-tax foreign exchange loss of $4 million in the third quarter of 2019 ($0.01 per diluted share), compared with a gain of $7 million in the second quarter of 2019 ($0.02 per diluted share), primarily due to Ilim’s U.S. dollar denominated net debt.
“International Paper delivered another quarter of solid earnings and strong cash generation,” said Mark Sutton, Chairman and Chief Executive Officer. “We continue to demonstrate the strength and resilience of our cash engine and our ability to perform well in a challenging global environment. Looking ahead to the fourth quarter, we will continue to maximize performance by optimizing our full value chain from fiber to the customer.”
