Harris DeLoach
Harris DeLoach
ability achieve believe confident costs focused growing growth improving line managing margins overall profitable remain results solutions strategy top total validate within
We believe the Company's 2005 results validate our overall growth strategy and specifically our Total Solutions initiative. During 2006, we will remain focused on growing our top line and improving margins by managing productivity and costs within our businesses. I have never been more confident in our ability to achieve sustainable and profitable growth.
base business company conditions consumer continued cost demand despite difficult due earnings engineered european factors favorable fourth higher increased labor maintain material north offset overall packaging positive primarily quarter raw relationship robust segments services volume weaker wide
Fourth quarter 2005 base earnings were robust due primarily to increased volume in our Consumer Packaging and Packaging Services segments and company wide productivity improvements and cost containment. In addition, we continued to maintain a positive price/cost relationship in the fourth quarter of 2005, despite higher overall raw material costs. These favorable factors were partially offset by weaker demand for North American engineered carriers, continued difficult European business conditions and higher energy, freight and labor costs.
business core folding growth longer portfolio proceeds products reduce sale small strategy supporting
Our small folding cartons business is no longer core to our growth strategy and supporting portfolio of products and services. Proceeds from the sale will be used to reduce debt.
certainty coming company consumer continued costs customers delivered despite driven earnings efforts employees energy focused gas growth improved improvement improving key maintained majority managing margin market meeting natural needs performance positive product provide raw remained rising sales sustained volume wide
Sonoco delivered on its key performance initiatives in 2005. The Company experienced sustained quarterly earnings increases, margin improvement and double-digit sales growth driven by acquisitions, improved company wide volume coming from significant new consumer product and market development, and geographical expansion. Our employees remained focused on meeting the needs of our customers while improving productivity and managing costs in all of our businesses. We continued our efforts to successfully hedge the majority of our natural gas needs to provide more certainty of energy costs, and we maintained a positive price/cost relationship, despite rising costs in most raw materials.