08/29/10 — Plant one of nation's most trusted companies

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Plant one of nation's most trusted companies

By Steve Herring
Published in News on August 29, 2010 1:50 AM

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An employee works at Packaging Corp. of America on North William Street where corrugated boxes are made.

Officials at a Goldsboro plant that is part of an Illinois-based company say that a reputation for customer service and quality products contributed to it being named by Forbes magazine as one of The Top 100 Most Trustworthy Companies in the United States.

"I think that (reputation) had a lot to do with the company receiving the honor," said David Cunningham, general manager for Packaging Corp. of America on North William Street. "It is something that Forbes does on its own.

"From what I understand, they look at the financials, look at how people are treated, how we treat customers. I was surprised to see us in there. In the scheme of things, we are a small company."

Cunningham said that the company that makes corrugated boxes operates under the "Golden Rule."

"I think that it doesn't hurt to have anything verified by a third party and I think that Forbes is a well-known publication, a respected publication in the financial world," he said. "It wasn't something that we asked for. It was something they brought out on their own. I do think the more people who know about it they may consider thinking about PCA.

"I was very proud of the company. We are one of the few corrugated companies right now that are financially sound. We are a company that is strong financially."

Cunningham, who grew up in the Carolina Beach area, has been at the Goldsboro plant for three years. Prior to that he oversaw a PCA facility in St. Louis, Mo.

"We make corrugated boxes," he said. "We make displays that are placed on the shelves and the products are sold out of them. We have very large customers in food. We have the Cheesecake Factory, Con-Agra, and Monogram Foods. We are shipping all over the country for Con-Agra.

"If you walk into Sam's (Club) and look into the freezer and find cheesecake, I can guarantee it (container) came out of this plant. We make everything for them (Cheesecake Factory). When you go visit them you cannot walk in doors as a vendor without eating cheesecake."

The company has run-and-ship customers who call in an order and in about three days later it will ship directly to them, he said. It also has warehouse customers for whom the company warehouses products at all times.

More than 108 million-square-feet of packaging is used annually at the plant, he said.

More important than square footage is how much 1,000 feet sells for, he said. Cunningham said he could not provide specific figures, but that the plant has one of the highest rates in the company that nationwide has 71 plants and three paper mills.

"It is not so much the corrugated that we make that keeps us there, but the diversity of this plant," he said. "When I came to this plant, the plant had no diversification, we only made brown boxes."

Recently the plant added a hand line that assembles packaging that probably makes as much money as the machine line, he said.

"That has been a really big boost for us," he said. "I think that we are growing. We are controlled growing. I think the best way we have done it is that we have been steady."

The plant, which employs 37 people, has more than doubled its capacity over the past year-and-a-half, he said. There are a number of longtime employees and many have been there six to seven years.

Cunningham said the company is "people driven" and looks after its employees. Only one person has been let go from the plant in the past 10 years, he said.

PCA is headquartered at Lake Forest, Ill., just outside of Chicago.

"We are a totally integrated plant," he said. "We are green to the point that right at this particular moment, one of our (paper mill) plants uses no fossil fuels. We use the byproduct of the wood called black liquor. We basically run that plant off of black liquor. A second plant that has been using the black liquor is getting ready to switch to it exclusively."

Formerly known as Tenneco, the plant has been in Goldsboro for 30 some years.

According to a Forbes press release the magazine used Audit Integrity, an independent financial analysis company, to identify the most transparent and trustworthy businesses traded on Wall Street.

Listed among the mid-cap companies with an Accounting and Governance Risk score of 85, PCA made the list and was one of more than 8,000 corporations reviewed in 2010.

The evaluation goes beyond just income statements and balance sheets. Businesses have to maintain conservative accounting practices and transparent government protocol. The AGR score is derived from statistical analysis of more than 100 metrics that have historically been associated with transparent financial reporting and corporate governance.

According to Audit Integrity, the companies recognized have a much lower risk profit profile than their peers and are much less likely to suffer negative events such as regulatory actions, earnings restatements, class-action litigation and bankruptcy. They also outperform the market.