Sealed Air Corporation (Sealed Air) expects net sales of about $1.1 billion to $1.2 billion for the fourth quarter of 2008. It also expects a pre-tax charge of $20 million, or $0.07 per diluted common share, for the fourth quarter of 2008.
This additional impairment is owing to the continuing decline in the creditworthiness of the issuers of these securities and the lack of a market for auction rate securities generally. Together with charges incurred in preceding quarters, this brings the aggregate predictable charge for impairment of available-for-sale securities to $0.11 per diluted common share for the Sealed Air’s full year 2008. The face value of the Sealed Air’s auction rate securities investments is about $45 million and the expected remaining fair value is about $11 million at December 31, 2008. This charge will be reported as a non-operating expense.
The net sale includes the negative impact from foreign currency translation of about $60 – $70 million compared with earlier year. The impact of before announced price increases and the reduction of raw material costs during the quarter will result in a sequential improvement in gross profit as a percentage of net sales compared to the third quarter of 2008. Further Sealed Air tightened its control of expenses. The company noted that in the fourth quarter of 2008, it started to realize benefits from its cost reduction and productivity program and continued savings from its global manufacturing strategy.