Packaging Corp. of America sees spike in demand

Packaging Corp. of America, the fifth-largest U.S. maker of cardboard shipping containers, rose the most in 13 weeks after reporting a "significant" increase in demand earlier this month.

Packaging Corp. climbed $2.46, or 19 percent, to $15.28 at 11:44 a.m. in New York Stock Exchange composite trading, the biggest intraday gain since Jan. 21. Shares of the Lake Forest-based company fell 4.8 percent this year through yesterday.

Customer bookings for the company's corrugated products rose almost 15 percent in the first 10 days of April, compared with March, Chief Executive Officer Paul Stecko said today on conference call with investors and analysts. Shipments of corrugated products in the first 10 days of April were 6.5 percent more than in March, he said.

"It's like somebody turned the light switch on," said Stecko, who described the increase as "significant." While he said bookings this month are little changed from a year earlier, "this is really the first big pickup in demand that we've seen since September."

Packaging Corp. is among makers of containerboard, the paper used in corrugated boxes, that curtailed some production to help support prices after demand fell in the fourth quarter.

The company yesterday said first-quarter net income fell to $25.7 million, or 25 cents a share, from $32.1 million, or 31 cents, a year earlier. Profit topped the 19-cent average estimate of eight analysts surveyed by Bloomberg.

Packaging Corp. expects earnings, excluding one-time items, of 15 cents a share in the second quarter. The average estimate of eight analysts surveyed by Bloomberg is 16 cents.