October 21, 2010 / 10:07 PM / in 8 years

UPDATE 1-Winpak Q3 earnings trail estimates

* Q3 EPS $0.18 vs est $0.19

* Sales $146.1 mln vs est $137.9 mln

* Says remains optimistic about volume growth in Q4, 2011

Oct 21 (Reuters) - Canada’s Winpak Ltd (WPK.TO), which makes packaging materials and machines, posted third-quarter earnings that lagged market estimates, hurt by higher raw material costs.

The company, however, said it remained optimistic about volume growth in the fourth quarter and into 2011 as demand appears solid across all product groups.

For the quarter, the Winnipeg, Manitoba-based company posted net earnings of $11.9 million, or 18 cents a share, compared with $9.9 million, or 15 cents per share, a year ago.

Sales rose 16 percent to $146.1 million.

Analysts on average were expecting earnings of 19 cents a share, on revenue of $137.9 million, according to Thomson Reuters I/B/E/S.

Gross profit margins for the quarter ended Sept. 26 were 28.2 percent of sales, down from 29.7 percent a year earlier.

“Gross profit margins should remain within one or two percentage points of current levels,” the company said.

Winpak also said it continues to evaluate acquisition opportunities to complement its food and health care packaging divisions.

The company’s shares, which have gained about 12 percent in value in the past three months, closed at C$11.14 Thursday on the Toronto Stock Exchange. (Reporting by Arnika Thakur in Bangalore; Editing by Anne Pallivathuckal)

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