STAMFORD, Conn. (AP) – International Paper Co., the world’s largest paper company, blamed higher energy costs and declining prices for paper products for a 59 percent slump in the company’s second-quarter profits.

IP on Thursday reported net income of $88 million, or 19 cents per share, down from profits of $215 million, or 45 cents per share, during the same period last year.

In Maine, the company has mills in Jay and Bucksport.

The results beat the consensus estimate of analysts surveyed by Thomson First Call by 2 cents per share.

“Energy and weather-related wood costs remained high, volumes were slightly lower than the first quarter and prices declined in uncoated paper, linerboard and boxes,” said John Dillon, IP’s chairman and chief executive officer.

“We continue to overcome these external pressures to improve our profitability through manufacturing excellence, creating customer value and streamlining our cost structure,” he said.

Second-quarter revenue fell to $6.2 billion from $6.3 billion a year ago.

For the first half, IP reported net income of $132 million, or 28 cents per share, compared with a loss of $895 million, or $1.86 per share, in the first half of 2002.

The year-ago figures reflect a $1.2 billion charge related to a change in goodwill accounting. The six-month figures for this year reflect a $10 million charge related to a change in asset accounting.

First-half sales were flat at $12.3 billion.

IP stock was down 71 cents to close at $37.87 on the New York Stock Exchange.

—

On the Net: http://www.internationalpaper.com

AP-ES-07-24-03 1657EDT