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Earnings Forecasts

Avery lowers 2007 expectations

September 11, 2007|From Times Wire Services

Label maker Avery Dennison Corp. lowered its profit forecast for 2007 after lower-than-expected sales in July and August.

Sales in the last two months were "well below expectations," Chief Financial Officer Daniel R. O'Bryant said. If demand doesn't pick up, profit for the year could be as low as $3.75 a share, compared with a forecast of $3.90 to $4.10 reported in July, he said.

Analysts on average had expected $4.05 a share, according to a Bloomberg survey.

"We are taking actions to reduce costs in light of the weaker sales environment, but we will not be able to fully offset the sales shortfall," O'Bryant said. A "soft retail environment" hurt sales of office products and retail information services, he said.

The company said its acquisition of clothing label maker Paxar, which was completed June 15, would add as much as 50 cents a share to 2008 earnings, and as much as $1 a share when Paxar is fully integrated.

Shares of Avery, based in Pasadena, fell $2.02 to $56.37.

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