Avery Dennison Corp. surprised investors Tuesday when it reported better-than-expected earnings despite a big dip in profit due to charges related to its acquisition of Paxar and weak domestic demand for its retail products.
Avery reported third-quarter net income of $58 million (59 cents per share), a 31 percent dip from $85 million (85 cents) from the same period a year earlier, missing Wall Street's expectations of 90 cents per share, according to a poll conducted by Thomson Financial.
However, the quarter's results include 41 cents per share in charges stemming from restructuring and transition costs associated with the integration of label-maker Paxar Corp., which the company bought in March for $1.3 billion.
Revenue for the Pasadena-based label and office supply maker rose 19 percent to $1.7 billion, beating analysts' expectations of $1.66 billion. Avery said it was hurt by weaker retail demand in the U.S. in its office products and retail-information services units.
Shares in Avery shot up 5.2 percent, or $2.87 to $58.53 in afternoon trading Tuesday on the New York stock Exchange.
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