`
FORM 10-Q
☒ | Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
2022
☐ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Commission file number | Exact name of registrant as specified in its charter | IRS Employer Identification No. | State or other jurisdiction of incorporation or organization | |||||||||||||||||||||||
1-03560 | Glatfelter Corporation | 23-0628360 | Pennsylvania |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Common Stock | GLT | New York Stock Exchange |
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Large Accelerated Filer | ☒ | Accelerated filer | ☐ | ||||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||||||||||
Emerging growth company | ☐ | ||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
Quarterly Period Ended
2022
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Item 1 |
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| 2 | ||||||||||||||||
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| 3 | ||||||||||||||||
| Condensed Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020 (unaudited) |
| 4 | |||||||||||||||
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| 6 | Condensed Consolidated Statements of Income for the three months and six months ended June 30, 2022 and 2021 (unaudited) | |||||||||||||||
| Notes to Condensed Consolidated Financial Statements (unaudited) |
| 7 | Condensed Consolidated Statements of Comprehensive Income for the three months and six months ended June 30, 2022 and 2021 (unaudited) | ||||||||||||||
| 1. |
| 7 | Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021 (unaudited) | ||||||||||||||
| 2. |
| 7 | Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021 (unaudited) | ||||||||||||||
| 3. |
| 7 | Statements of Shareholders’ Equity for the three months and six months ended June 30, 2022 and 2021 (unaudited) | ||||||||||||||
| 4. |
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| 5. |
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| 6. |
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| 7. |
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| 8. |
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| 9. |
| 11 | 5 | ||||||||||||||
| 10. |
| 12 | 6 | ||||||||||||||
| 11. |
| 13 | 7 | ||||||||||||||
| 12. |
| 14 | 8 | ||||||||||||||
| 13. |
| 15 | 9 | ||||||||||||||
| 14. |
| 16 | 10 | ||||||||||||||
| 15. |
| 17 | 11 | ||||||||||||||
| 16. |
| 17 | 12 | ||||||||||||||
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| 18 | 13 | ||||||||||||||
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| 20 | 15 | ||||||||||||||
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| 20 | 16 | ||||||||||||||
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| 23 | 17 | ||||||||||||||
| 22. |
| 24 | 18 | ||||||||||||||
| 23. |
| 25 | 19 | ||||||||||||||
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Item 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3 |
| 37 | ||||||||||||||||
Item 4 |
| 37 | ||||||||||||||||
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PART II – OTHER INFORMATION | PART II – OTHER INFORMATION |
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Item 1A | Item 1A | |||||||||||||||||
Item 6 |
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| 39 |
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| Three months ended June 30 |
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| Six months ended June 30 |
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||||||
In thousands, except per share |
| 2021 |
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| 2020 |
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| 2021 |
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| 2020 |
| In thousands, except per share | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
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Net sales |
| $ | 244,911 |
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| $ | 216,183 |
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| $ | 470,585 |
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| $ | 447,743 |
| Net sales | $ | 363,963 | $ | 244,911 | $ | 745,643 | $ | 470,585 | ||||||||||||||
Costs of products sold |
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| 209,357 |
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| 184,120 |
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| 395,735 |
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| 378,878 |
| Costs of products sold | 326,566 | 209,357 | 676,581 | 395,735 | ||||||||||||||||||
Gross profit |
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| 35,554 |
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| 32,063 |
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| 74,850 |
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| 68,865 |
| Gross profit | 37,397 | 35,554 | 69,062 | 74,850 | ||||||||||||||||||
Selling, general and administrative expenses |
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| 28,984 |
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| 23,551 |
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| 51,811 |
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| 48,072 |
| Selling, general and administrative expenses | 28,400 | 28,984 | 61,566 | 51,811 | ||||||||||||||||||
Gains on dispositions of plant, equipment and timberlands, net |
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| (1,553 | ) |
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| (597 | ) |
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| (2,403 | ) |
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| (597 | ) | |||||||||||||||||||||||
Operating income |
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| 8,123 |
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| 9,109 |
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| 25,442 |
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| 21,390 |
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Goodwill and other asset impairment charges | Goodwill and other asset impairment charges | — | — | 117,349 | — | ||||||||||||||||||||||||||||||||||
Loss (gains) on dispositions of plant, equipment and timberlands, net | Loss (gains) on dispositions of plant, equipment and timberlands, net | 73 | (1,553) | (2,888) | (2,403) | ||||||||||||||||||||||||||||||||||
Operating income (loss) | Operating income (loss) | 8,924 | 8,123 | (106,965) | 25,442 | ||||||||||||||||||||||||||||||||||
Non-operating income (expense) |
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| Non-operating income (expense) | ||||||||||||||||||||||
Interest expense |
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| (1,772 | ) |
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| (1,759 | ) |
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| (3,303 | ) |
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| (3,537 | ) | Interest expense | (7,672) | (1,772) | (15,534) | (3,303) | ||||||||||||||||||
Interest income |
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| 11 |
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| 87 |
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| 31 |
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| 351 |
| Interest income | 38 | 11 | 55 | 31 | ||||||||||||||||||
Pension settlement expenses, net |
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| — |
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| (6,330 | ) |
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| — |
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| (6,403 | ) | |||||||||||||||||||||||
Other, net |
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| (849 | ) |
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| (835 | ) |
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| (1,073 | ) |
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| (1,515 | ) | Other, net | (455) | (849) | (1,795) | (1,073) | ||||||||||||||||||
Total non-operating expense |
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| (2,610 | ) |
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| (8,837 | ) |
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| (4,345 | ) |
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| (11,104 | ) | Total non-operating expense | (8,089) | (2,610) | (17,274) | (4,345) | ||||||||||||||||||
Income from continuing operations before income taxes |
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| 5,513 |
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| 272 |
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| 21,097 |
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| 10,286 |
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Income tax provision |
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| 4,021 |
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| 2,553 |
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| 11,211 |
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| 5,161 |
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Income (loss) from continuing operations before income taxes | Income (loss) from continuing operations before income taxes | 835 | 5,513 | (124,239) | 21,097 | ||||||||||||||||||||||||||||||||||
Income tax provision (benefit) | Income tax provision (benefit) | 3,295 | 4,021 | (13,489) | 11,211 | ||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations |
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| 1,492 |
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| (2,281 | ) |
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| 9,886 |
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| 5,125 |
| Income (loss) from continuing operations | (2,460) | 1,492 | (110,750) | 9,886 | ||||||||||||||||||
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Discontinued operations: |
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| Discontinued operations: | ||||||||||||||||||||||
Loss before income taxes |
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| (82 | ) |
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| (135 | ) |
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| (82 | ) |
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| (135 | ) | |||||||||||||||||||||||
Income (loss) before income taxes | Income (loss) before income taxes | 408 | (82) | 371 | (82) | ||||||||||||||||||||||||||||||||||
Income tax provision |
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| — |
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| — |
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| — |
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| — |
| Income tax provision | — | — | — | — | ||||||||||||||||||
Loss from discontinued operations |
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| (82 | ) |
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| (135 | ) |
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| (82 | ) |
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| (135 | ) | Loss from discontinued operations | 408 | (82) | 371 | (82) | ||||||||||||||||||
Net income (loss) |
| $ | 1,410 |
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| $ | (2,416 | ) |
| $ | 9,804 |
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| $ | 4,990 |
| Net income (loss) | $ | (2,052) | $ | 1,410 | $ | (110,379) | $ | 9,804 | ||||||||||||||
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Basic earnings per share |
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| Basic earnings per share | ||||||||||||||||||||||
Income (loss) from continuing operations |
| $ | 0.03 |
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| $ | (0.05 | ) |
| $ | 0.22 |
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| $ | 0.12 |
| Income (loss) from continuing operations | $ | (0.05) | $ | 0.03 | $ | (2.47) | $ | 0.22 | ||||||||||||||
Loss from discontinued operations |
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| — |
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| — |
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| — |
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| (0.01 | ) | |||||||||||||||||||||||
Basic earnings per share |
| $ | 0.03 |
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| $ | (0.05 | ) |
| $ | 0.22 |
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| $ | 0.11 |
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Income from discontinued operations | Income from discontinued operations | 0.01 | — | 0.01 | — | ||||||||||||||||||||||||||||||||||
Basic earnings (loss) per share | Basic earnings (loss) per share | $ | (0.04) | $ | 0.03 | $ | (2.46) | $ | 0.22 | ||||||||||||||||||||||||||||||
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Diluted earnings per share |
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| Diluted earnings per share | ||||||||||||||||||||||
Income (loss) from continuing operations |
| $ | 0.03 |
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| $ | (0.05 | ) |
| $ | 0.22 |
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| $ | 0.12 |
| Income (loss) from continuing operations | $ | (0.05) | $ | 0.03 | $ | (2.47) | $ | 0.22 | ||||||||||||||
Loss from discontinued operations |
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| — |
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| — |
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| — |
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| (0.01 | ) | |||||||||||||||||||||||
Diluted earnings per share |
| $ | 0.03 |
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| $ | (0.05 | ) |
| $ | 0.22 |
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| $ | 0.11 |
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Income from discontinued operations | Income from discontinued operations | 0.01 | — | 0.01 | — | ||||||||||||||||||||||||||||||||||
Diluted earnings (loss) per share | Diluted earnings (loss) per share | $ | (0.04) | $ | 0.03 | $ | (2.46) | $ | 0.22 | ||||||||||||||||||||||||||||||
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Weighted average shares outstanding |
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| Weighted average shares outstanding | ||||||||||||||||||||||
Basic |
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| 44,563 |
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| 44,343 |
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| 44,507 |
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| 44,309 |
| Basic | 44,841 | 44,563 | 44,775 | 44,507 | ||||||||||||||||||
Diluted |
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| 44,872 |
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| 44,343 |
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| 44,865 |
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| 44,541 |
| Diluted | 44,841 | 44,872 | 44,775 | 44,865 |
GLATFELTER
Form 10-Q
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| Three months ended June 30 |
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| Six months ended June 30 |
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In thousands |
| 2021 |
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| 2020 |
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| 2021 |
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| 2020 |
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Net income (loss) |
| $ | 1,410 |
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| $ | (2,416 | ) |
| $ | 9,804 |
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| $ | 4,990 |
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Foreign currency translation adjustments |
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| 3,846 |
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| 5,891 |
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| (9,347 | ) |
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| (8,012 | ) |
Net change in: |
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Deferred gains (losses) on cash flow hedges, net of taxes of $114, $295, $(1,187) and $696, respectively |
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| (316 | ) |
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| (552 | ) |
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| 2,945 |
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| (1,869 | ) |
Unrecognized retirement obligations, net of taxes of $(14), $52, $(87) and $103, respectively |
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| 150 |
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| (99 | ) |
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| 242 |
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| (200 | ) |
Other comprehensive income (loss) |
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| 3,680 |
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| 5,240 |
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| (6,160 | ) |
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| (10,081 | ) |
Comprehensive income (loss) |
| $ | 5,090 |
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| $ | 2,824 |
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| $ | 3,644 |
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| $ | (5,091 | ) |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
In thousands | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Net income (loss) | $ | (2,052) | $ | 1,410 | $ | (110,379) | $ | 9,804 | |||||||||||||||
Foreign currency translation adjustments | (28,675) | 3,846 | (39,590) | (9,347) | |||||||||||||||||||
Net change in: | |||||||||||||||||||||||
Deferred gains (losses) on derivatives, net of taxes of $(2,029), $114, $(2,629) and $(1,187), respectively | 8,534 | (316) | 8,177 | 2,945 | |||||||||||||||||||
Unrecognized retirement obligations, net of taxes of $(49), $(14), $(101) and $(87), respectively | 152 | 150 | 304 | 242 | |||||||||||||||||||
Other comprehensive income (loss) | (19,989) | 3,680 | (31,109) | (6,160) | |||||||||||||||||||
Comprehensive income (loss) | $ | (22,041) | $ | 5,090 | $ | (141,488) | $ | 3,644 |
GLATFELTER
Form 10-Q
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| June 30 |
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| December 31 |
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In thousands |
| 2021 |
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| 2020 |
| In thousands | June 30, 2022 | December 31, 2021 | ||||||||||
Assets |
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| Assets | ||||||||||
Cash and cash equivalents |
| $ | 84,164 |
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| $ | 99,581 |
| Cash and cash equivalents | $ | 71,476 | $ | 138,436 | ||||||
Accounts receivable, net |
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| 144,155 |
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| 122,817 |
| Accounts receivable, net | 209,455 | 170,212 | ||||||||
Inventories |
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| 220,206 |
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| 196,230 |
| Inventories | 307,612 | 279,520 | ||||||||
Prepaid expenses and other current assets |
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| 43,578 |
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| 34,297 |
| Prepaid expenses and other current assets | 46,083 | 48,398 | ||||||||
Total current assets |
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| 492,103 |
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| 452,925 |
| Total current assets | 634,626 | 636,566 | ||||||||
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Plant, equipment and timberlands, net |
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| 621,103 |
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| 543,267 |
| Plant, equipment and timberlands, net | 690,228 | 758,812 | ||||||||
Goodwill |
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| 195,461 |
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| 164,369 |
| Goodwill | 168,288 | 236,165 | ||||||||
Intangible assets, net |
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| 95,022 |
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| 81,835 |
| Intangible assets, net | 110,096 | 156,304 | ||||||||
Other assets |
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| 56,401 |
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| 44,485 |
| Other assets | 94,052 | 92,760 | ||||||||
Total assets |
| $ | 1,460,090 |
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| $ | 1,286,881 |
| Total assets | $ | 1,697,290 | $ | 1,880,607 | ||||||
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Liabilities and Shareholders' Equity |
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| Liabilities and Shareholders' Equity | ||||||||||
Current portion of long-term debt |
| $ | 24,267 |
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| $ | 25,057 |
| Current portion of long-term debt | $ | 22,117 | $ | 26,437 | ||||||
Short-term debt |
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| 11,884 |
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| Short-term debt | 10,610 | 22,843 | ||||||||
Accounts payable |
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| 122,834 |
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| 127,505 |
| Accounts payable | 208,181 | 214,015 | ||||||||
Dividends payable |
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| 6,233 |
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| 5,988 |
| Dividends payable | 6,269 | 6,237 | ||||||||
Environmental liabilities |
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| 3,206 |
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| 3,700 |
| Environmental liabilities | 2,200 | 2,200 | ||||||||
Other current liabilities |
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| 73,930 |
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| 71,093 |
| Other current liabilities | 78,143 | 99,438 | ||||||||
Total current liabilities |
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| 242,354 |
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| 233,343 |
| Total current liabilities | 327,520 | 371,170 | ||||||||
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Long-term debt |
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| 445,261 |
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| 288,464 |
| Long-term debt | 779,026 | 738,075 | ||||||||
Deferred income taxes |
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| 77,123 |
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| 77,131 |
| Deferred income taxes | 63,025 | 87,285 | ||||||||
Other long-term liabilities |
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| 124,107 |
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| 110,011 |
| Other long-term liabilities | 137,797 | 141,315 | ||||||||
Total liabilities |
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| 888,845 |
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| 708,949 |
| Total liabilities | 1,307,368 | 1,337,845 | ||||||||
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Commitments and contingencies |
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| — |
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| — |
| Commitments and contingencies | — | — | ||||||||
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Shareholders’ equity |
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| Shareholders’ equity | ||||||||||
Common stock |
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| 544 |
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| 544 |
| Common stock | 544 | 544 | ||||||||
Capital in excess of par value |
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| 62,796 |
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| 63,261 |
| Capital in excess of par value | 62,555 | 64,779 | ||||||||
Retained earnings |
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| 720,934 |
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| 723,365 |
| Retained earnings | 582,687 | 705,600 | ||||||||
Accumulated other comprehensive loss |
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| (64,813 | ) |
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| (58,653 | ) | Accumulated other comprehensive loss | (111,413) | (80,304) | ||||||||
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| 719,461 |
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| 728,517 |
| 534,373 | 690,619 | |||||||||
Less cost of common stock in treasury |
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| (148,216 | ) |
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| (150,585 | ) | Less cost of common stock in treasury | (144,451) | (147,857) | ||||||||
Total shareholders’ equity |
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| 571,245 |
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| 577,932 |
| Total shareholders’ equity | 389,922 | 542,762 | ||||||||
Total liabilities and shareholders’ equity |
| $ | 1,460,090 |
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| $ | 1,286,881 |
| Total liabilities and shareholders’ equity | $ | 1,697,290 | $ | 1,880,607 |
GLATFELTER
Form 10-Q
|
| Six months ended June 30 |
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In thousands |
| 2021 |
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| 2020 |
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Operating activities |
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Net income |
| $ | 9,804 |
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| $ | 4,990 |
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Loss from discontinued operations, net of taxes |
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| 82 |
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| 135 |
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Adjustments to reconcile to net cash provided (used) by continuing operations: |
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Depreciation, depletion and amortization |
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| 28,466 |
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| 29,608 |
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Amortization of debt issue costs and original issue discount |
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| 309 |
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| 293 |
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Asset impairment charge |
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| — |
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| 900 |
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Deferred income tax provision (benefit) |
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| 616 |
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| (2,432 | ) |
Gains on dispositions of plant, equipment and timberlands, net |
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| (2,403 | ) |
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| (597 | ) |
Share-based compensation |
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| 2,537 |
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| 2,377 |
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Change in operating assets and liabilities: |
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Accounts receivable |
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| (11,533 | ) |
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| 1,388 |
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Inventories |
|
| (21,870 | ) |
|
| (7,450 | ) |
Prepaid and other current assets |
|
| 3,377 |
|
|
| (1,757 | ) |
Accounts payable |
|
| (4,542 | ) |
|
| (33,062 | ) |
Accruals and other current liabilities |
|
| (5,841 | ) |
|
| 2,510 |
|
Other |
|
| 2,363 |
|
|
| 2,185 |
|
Net cash provided (used) by operating activities from continuing operations |
|
| 1,365 |
|
|
| (912 | ) |
Investing activities |
|
|
|
|
|
|
|
|
Expenditures for purchases of plant, equipment and timberlands |
|
| (11,211 | ) |
|
| (12,011 | ) |
Proceeds from disposals of plant, equipment and timberlands, net |
|
| 2,510 |
|
|
| 613 |
|
Acquisition, net of cash acquired |
|
| (172,331 | ) |
|
| — |
|
Other |
|
| (104 | ) |
|
| (50 | ) |
Net cash used by investing activities from continuing operations |
|
| (181,136 | ) |
|
| (11,448 | ) |
Financing activities |
|
|
|
|
|
|
|
|
Proceeds from short-term debt |
|
| 11,725 |
|
|
| — |
|
Net borrowings under revolving credit facility |
|
| 178,077 |
|
|
| — |
|
Payments of borrowing costs |
|
| (35 | ) |
|
| — |
|
Repayment of term loans |
|
| (12,159 | ) |
|
| (11,300 | ) |
Payments of dividends |
|
| (11,991 | ) |
|
| (11,513 | ) |
Payments related to share-based compensation awards and other |
|
| (479 | ) |
|
| (362 | ) |
Net cash provided (used) by financing activities from continuing operations |
|
| 165,138 |
|
|
| (23,175 | ) |
Effect of exchange rate changes on cash |
|
| (1,432 | ) |
|
| (123 | ) |
Net decrease in cash, cash equivalents and restricted cash |
|
| (16,065 | ) |
|
| (35,658 | ) |
Decrease in cash, cash equivalents and restricted cash from discontinued operations |
|
| (238 | ) |
|
| (945 | ) |
Cash, cash equivalents and restricted cash at the beginning of period |
|
| 111,665 |
|
|
| 126,201 |
|
Cash, cash equivalents and restricted cash at the end of period |
|
| 95,362 |
|
|
| 89,598 |
|
Less: restricted cash in Prepaid expenses and other current assets |
|
| (2,000 | ) |
|
| (2,000 | ) |
Less: restricted cash in Other assets |
|
| (9,197 | ) |
|
| (10,979 | ) |
Cash and cash equivalents at the end of period |
| $ | 84,165 |
|
| $ | 76,619 |
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information |
|
|
|
|
|
|
|
|
Cash paid for: |
|
|
|
|
|
|
|
|
Interest |
| $ | 2,920 |
|
| $ | 3,175 |
|
Income taxes, net |
|
| 7,098 |
|
|
| 4,669 |
|
Six months ended June 30, | |||||||||||
In thousands | 2022 | 2021 | |||||||||
Operating activities | |||||||||||
Net income (loss) | $ | (110,379) | $ | 9,804 | |||||||
Loss (income) from discontinued operations, net of taxes | (371) | 82 | |||||||||
Adjustments to reconcile to net cash provided (used) by continuing operations: | |||||||||||
Depreciation, depletion and amortization | 34,936 | 28,466 | |||||||||
Amortization of debt issue costs and original issue discount | 963 | 309 | |||||||||
Goodwill and other asset impairment charges | 117,349 | — | |||||||||
Inventory and accounts receivable charges | 3,948 | — | |||||||||
Deferred income tax expense (benefit) | (22,186) | 616 | |||||||||
Gains on dispositions of plant, equipment and timberlands, net | (2,888) | (2,403) | |||||||||
Share-based compensation | 2,419 | 2,537 | |||||||||
Change in operating assets and liabilities: | |||||||||||
Accounts receivable | (52,936) | (11,533) | |||||||||
Inventories | (45,148) | (21,870) | |||||||||
Prepaid and other current assets | 3,472 | 3,377 | |||||||||
Accounts payable | 9,516 | (4,542) | |||||||||
Accruals and other current liabilities | (16,910) | (5,841) | |||||||||
Other | (1,320) | 2,363 | |||||||||
Net cash provided (used) by operating activities from continuing operations | (79,535) | 1,365 | |||||||||
Investing activities | |||||||||||
Expenditures for purchases of plant, equipment and timberlands | (22,697) | (11,211) | |||||||||
Proceeds from disposals of plant, equipment and timberlands, net | 3,173 | 2,510 | |||||||||
Acquisition, net of cash acquired | 1,413 | (172,331) | |||||||||
Other | (25) | (104) | |||||||||
Net cash used by investing activities from continuing operations | (18,136) | (181,136) | |||||||||
Financing activities | |||||||||||
Proceeds from term loans | — | 11,725 | |||||||||
Repayment of term loans | (23,793) | (12,159) | |||||||||
Net borrowings under revolving credit facility | 72,176 | 178,077 | |||||||||
Payments of borrowing costs | (1,102) | (35) | |||||||||
Payments of dividends | (12,498) | (11,991) | |||||||||
Payments related to share-based compensation awards and other | (1,237) | (479) | |||||||||
Net cash provided by financing activities from continuing operations | 33,546 | 165,138 | |||||||||
Effect of exchange rate changes on cash | (3,587) | (1,432) | |||||||||
Net decrease in cash, cash equivalents and restricted cash | (67,712) | (16,065) | |||||||||
Decrease in cash, cash equivalents and restricted cash from discontinued operations | (231) | (238) | |||||||||
Cash, cash equivalents and restricted cash at the beginning of period | 148,814 | 111,665 | |||||||||
Cash, cash equivalents and restricted cash at the end of period | 80,871 | 95,362 | |||||||||
Less: restricted cash in Prepaid expenses and other current assets | (2,000) | (2,000) | |||||||||
Less: restricted cash in Other assets | (7,395) | (9,197) | |||||||||
Cash and cash equivalents at the end of period | $ | 71,476 | $ | 84,165 | |||||||
Supplemental cash flow information | |||||||||||
Cash paid for: | |||||||||||
Interest | $ | 15,879 | $ | 2,920 | |||||||
Income taxes, net | 14,699 | 7,098 |
GLATFELTER
Form 10-Q
In thousands | Common stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total Shareholders’ Equity | |||||||||||||||||||||||||||||
Balance at April 1, 2022 | $ | 544 | $ | 61,873 | $ | 591,012 | $ | (91,424) | $ | (145,272) | $ | 416,733 | |||||||||||||||||||||||
Net loss | (2,052) | (2,052) | |||||||||||||||||||||||||||||||||
Other comprehensive loss | (19,989) | (19,989) | |||||||||||||||||||||||||||||||||
Comprehensive loss | (22,041) | ||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.14 per share) | (6,273) | (6,273) | |||||||||||||||||||||||||||||||||
Share-based compensation expense | 1,510 | 1,510 | |||||||||||||||||||||||||||||||||
Delivery of treasury shares: | |||||||||||||||||||||||||||||||||||
RSUs and PSAs | (828) | 821 | (7) | ||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | $ | 544 | $ | 62,555 | $ | 582,687 | $ | (111,413) | $ | (144,451) | $ | 389,922 | |||||||||||||||||||||||
Balance at April 1, 2021 | $ | 544 | $ | 62,576 | $ | 725,756 | $ | (68,493) | $ | (149,322) | $ | 571,061 | |||||||||||||||||||||||
Net income | 1,410 | 1,410 | |||||||||||||||||||||||||||||||||
Other comprehensive income | 3,680 | 3,680 | |||||||||||||||||||||||||||||||||
Comprehensive income | 5,090 | ||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.14 per share) | (6,232) | (6,232) | |||||||||||||||||||||||||||||||||
Share-based compensation expense | 1,329 | 1,329 | |||||||||||||||||||||||||||||||||
Delivery of treasury shares: | |||||||||||||||||||||||||||||||||||
RSUs and PSAs | (1,109) | 1,106 | (3) | ||||||||||||||||||||||||||||||||
Balance at June 30, 2021 | $ | 544 | $ | 62,796 | $ | 720,934 | $ | (64,813) | $ | (148,216) | $ | 571,245 | |||||||||||||||||||||||
Balance at January 1, 2022 | $ | 544 | $ | 64,779 | $ | 705,600 | $ | (80,304) | $ | (147,857) | $ | 542,762 | |||||||||||||||||||||||
Net loss | (110,379) | (110,379) | |||||||||||||||||||||||||||||||||
Other comprehensive loss | (31,109) | (31,109) | |||||||||||||||||||||||||||||||||
Comprehensive loss | (141,488) | ||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.14 per share) | (12,534) | (12,534) | |||||||||||||||||||||||||||||||||
Share-based compensation expense | 2,419 | 2,419 | |||||||||||||||||||||||||||||||||
Delivery of treasury shares: | |||||||||||||||||||||||||||||||||||
RSUs and PSAs | (4,643) | 3,406 | (1,237) | ||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | $ | 544 | $ | 62,555 | $ | 582,687 | $ | (111,413) | $ | (144,451) | $ | 389,922 | |||||||||||||||||||||||
Balance at January 1, 2021 | $ | 544 | $ | 63,261 | $ | 723,365 | $ | (58,653) | $ | (150,585) | $ | 577,932 | |||||||||||||||||||||||
Net income | 9,804 | 9,804 | |||||||||||||||||||||||||||||||||
Other comprehensive loss | (6,160) | (6,160) | |||||||||||||||||||||||||||||||||
Comprehensive income | 3,644 | ||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.275 per share) | (12,235) | (12,235) | |||||||||||||||||||||||||||||||||
Share-based compensation expense | 2,537 | 2,537 | |||||||||||||||||||||||||||||||||
Delivery of treasury shares: | |||||||||||||||||||||||||||||||||||
RSUs and PSAs | (3,002) | 2,369 | (633) | ||||||||||||||||||||||||||||||||
Balance at June 30, 2021 | $ | 544 | $ | 62,796 | $ | 720,934 | $ | (64,813) | $ | (148,216) | $ | 571,245 |
(unaudited)
In thousands |
| Common stock |
|
| Capital in Excess of Par Value |
|
| Retained Earnings |
|
| Accumulated Other Comprehensive Loss |
|
| Treasury Stock |
|
| Total Shareholders’ Equity |
| ||||||
Balance at April 1, 2021 |
| $ | 544 |
|
| $ | 62,576 |
|
| $ | 725,756 |
|
| $ | (68,493 | ) |
| $ | (149,322 | ) |
| $ | 571,061 |
|
Net income |
|
|
|
|
|
|
|
|
|
| 1,410 |
|
|
|
|
|
|
|
|
|
|
| 1,410 |
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,680 |
|
|
|
|
|
|
| 3,680 |
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,090 |
|
Cash dividends declared ($0.14 per share) |
|
|
|
|
|
|
|
|
|
| (6,232 | ) |
|
|
|
|
|
|
|
|
|
| (6,232 | ) |
Share-based compensation expense |
|
|
|
|
|
| 1,329 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,329 |
|
Delivery of treasury shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSUs and PSAs |
|
|
|
|
|
| (1,109 | ) |
|
|
|
|
|
|
|
|
|
| 1,106 |
|
|
| (3 | ) |
Balance at June 30, 2021 |
| $ | 544 |
|
| $ | 62,796 |
|
| $ | 720,934 |
|
| $ | (64,813 | ) |
| $ | (148,216 | ) |
| $ | 571,245 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at April 1, 2020 |
| $ | 544 |
|
| $ | 59,623 |
|
| $ | 727,440 |
|
| $ | (93,217 | ) |
| $ | (151,480 | ) |
| $ | 542,910 |
|
Net loss |
|
|
|
|
|
|
|
|
|
| (2,416 | ) |
|
|
|
|
|
|
|
|
|
| (2,416 | ) |
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 5,240 |
|
|
|
|
|
|
| 5,240 |
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,824 |
|
Cash dividends declared ($0.135 per share) |
|
|
|
|
|
|
|
|
|
| (5,989 | ) |
|
|
|
|
|
|
|
|
|
| (5,989 | ) |
Share-based compensation expense |
|
|
|
|
|
| 1,292 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 1,292 |
|
Delivery of treasury shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSUs and PSAs |
|
|
|
|
|
| (865 | ) |
|
|
|
|
|
|
|
|
|
| 850 |
|
|
| (15 | ) |
Employee stock options exercised — net |
|
|
|
|
|
| (68 | ) |
|
|
|
|
|
|
|
|
|
| 45 |
|
|
| (23 | ) |
Balance at June 30, 2020 |
| $ | 544 |
|
| $ | 59,982 |
|
| $ | 719,035 |
|
| $ | (87,977 | ) |
| $ | (150,585 | ) |
| $ | 540,999 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2021 |
| $ | 544 |
|
| $ | 63,261 |
|
| $ | 723,365 |
|
| $ | (58,653 | ) |
| $ | (150,585 | ) |
| $ | 577,932 |
|
Net income |
|
|
|
|
|
|
|
|
|
| 9,804 |
|
|
|
|
|
|
|
|
|
|
| 9,804 |
|
Other comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
| (6,160 | ) |
|
|
|
|
|
| (6,160 | ) |
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3,644 |
|
Cash dividends declared ($0.275 per share) |
|
|
|
|
|
|
|
|
|
| (12,235 | ) |
|
|
|
|
|
|
|
|
|
| (12,235 | ) |
Share-based compensation expense |
|
|
|
|
|
| 2,537 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,537 |
|
Delivery of treasury shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSUs and PSAs |
|
|
|
|
|
| (3,002 | ) |
|
|
|
|
|
|
|
|
|
| 2,369 |
|
|
| (633 | ) |
Balance at June 30, 2021 |
| $ | 544 |
|
| $ | 62,796 |
|
| $ | 720,934 |
|
| $ | (64,813 | ) |
| $ | (148,216 | ) |
| $ | 571,245 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2020 |
| $ | 544 |
|
| $ | 59,900 |
|
| $ | 725,795 |
|
| $ | (77,896 | ) |
| $ | (152,384 | ) |
| $ | 555,959 |
|
Net income |
|
|
|
|
|
|
|
|
|
| 4,990 |
|
|
|
|
|
|
|
|
|
|
| 4,990 |
|
Other comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
| (10,081 | ) |
|
|
|
|
|
| (10,081 | ) |
Comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (5,091 | ) |
Cash dividends declared ($0.265 per share) |
|
|
|
|
|
|
|
|
|
| (11,750 | ) |
|
|
|
|
|
|
|
|
|
| (11,750 | ) |
Share-based compensation expense |
|
|
|
|
|
| 2,377 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2,377 |
|
Delivery of treasury shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSUs and PSAs |
|
|
|
|
|
| (2,078 | ) |
|
|
|
|
|
|
|
|
|
| 1,657 |
|
|
| (421 | ) |
Employee stock options exercised — net |
|
|
|
|
|
| (217 | ) |
|
|
|
|
|
|
|
|
|
| 142 |
|
|
| (75 | ) |
Balance at June 30, 2020 |
| $ | 544 |
|
| $ | 59,982 |
|
| $ | 719,035 |
|
| $ | (87,977 | ) |
| $ | (150,585 | ) |
| $ | 540,999 |
|
The accompanying notes are an integral part of these condensed consolidated financial statements.
GLATFELTER
Form 10-Q
|
|
2. ACCOUNTING POLICIES |
|
Basis of Presentation The unaudited condensed consolidated financial statements (“financial statements”) include the accounts of Glatfelter and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated.
Recently Issued Accounting Pronouncements
|
|
On May 13, 2021, we completed the acquisition of all the outstanding equity interests in Georgia-Pacific Mt. Holly LLC, Georgia-Pacific's U.S. nonwovens business ("Mount Holly"), for $170.7 million, subject to customary post-closing purchase price adjustments. This business includes the Mount Holly, NC manufacturing facility with annual production capacity of approximately 37,000 metric tons and an R&D center and pilot line for nonwovens product development in Memphis, TN. The Mount Holly facility produces high-quality airlaid products for the wipes, hygiene, and other nonwoven materials markets, competing in the marketplace with nonwoven technologies and substrates, as well as other materials focused primarily on consumer based end-use applications. The facility employs approximately 140 people.$170.9 million. Mount Holly’s results are reported prospectively from the acquisition date as part of our Airlaid Materials segment.Mount Holly had annual net sales
for all outstanding shares and the extinguishment of Jacob Holm’s debt.
following table sets forth information related to the consideration exchanged for each acquisition.
In thousands | Mount Holly | Jacob Holm | Total | ||||||||||||||
Total consideration | $ | 170,919 | $ | 303,952 | $ | 474,871 | |||||||||||
Less: Debt repaid | — | (148,000) | (148,000) | ||||||||||||||
Cash consideration | $ | 170,919 | $ | 155,952 | $ | 326,871 |
In thousands | Mount Holly | Jacob Holm | Total | ||||||||||||||
Assets | |||||||||||||||||
Cash and cash equivalents | $ | — | $ | 11,426 | $ | 11,426 | |||||||||||
Accounts receivable | 11,599 | 30,271 | 41,870 | ||||||||||||||
Inventory | 7,031 | 45,340 | 52,371 | ||||||||||||||
Prepaid and other current assets | 11 | 6,727 | 6,738 | ||||||||||||||
Plant, equipment and timberlands | 100,498 | 158,612 | 259,110 | ||||||||||||||
Intangible assets | 20,000 | 70,240 | 90,240 | ||||||||||||||
Goodwill | 35,793 | 48,355 | 84,148 | ||||||||||||||
Other assets | 8,041 | 26,929 | 34,970 | ||||||||||||||
Total assets | 182,973 | 397,900 | 580,873 | ||||||||||||||
Liabilities | |||||||||||||||||
Short-term debt | 0 | 14,081 | 14,081 | ||||||||||||||
Accounts payable | 2,321 | 25,264 | 27,585 | ||||||||||||||
Other current liabilities | 1,868 | 21,263 | 23,131 | ||||||||||||||
Other long-term liabilities | 7,865 | 33,340 | 41,205 | ||||||||||||||
Total liabilities | 12,054 | 93,948 | 106,002 | ||||||||||||||
Total preliminary purchase price | $ | 170,919 | $ | 303,952 | $ | 474,871 |
- 7 -
GLATFELTER
Form 10-Q
The following table summarizes preliminary allocation of the purchase price to assets acquired and liabilities assumed is as follows:
In thousands |
|
|
|
| Preliminary Allocation |
| |
Assets |
|
|
|
|
|
|
|
Accounts receivable |
|
|
|
| $ | 11,576 |
|
Inventory |
|
|
|
|
| 7,031 |
|
Prepaid and other current assets |
|
|
|
|
| 11 |
|
Plant, equipment and timberlands |
|
|
|
|
| 100,498 |
|
Intangible assets |
|
|
|
|
| 20,000 |
|
Goodwill |
|
|
|
|
| 36,045 |
|
Other assets |
|
|
|
|
| 8,041 |
|
Total assets |
|
|
|
|
| 183,202 |
|
Liabilities |
|
|
|
|
|
|
|
Accounts payable |
|
|
|
|
| 2,587 |
|
Other current liabilities |
|
|
|
|
| 2,017 |
|
Other long-term liabilities |
|
|
|
|
| 7,865 |
|
Total liabilities |
|
|
|
|
| 12,469 |
|
Total purchase price |
|
|
|
| $ | 170,733 |
|
For purposes of allocating the total purchase price, assets acquired and liabilities assumed are recorded at their estimated fair market value.values. The allocationallocations set forth above isare based on management’s estimate of the fair value using valuation techniques such as discounted cash flow models, appraisals and similar methodologies.
Acquired property, plant and equipment are being depreciated on a straight-line basis with estimated remaining lives ranging from five years to 35 years. Intangible assets are being amortized on a straight-line basis over an estimated remaining life of 11 years reflecting the expected future value.
In connection with the Mount Holly acquisition, we recorded $36.0 million of goodwill and $20.0 million of identifiable intangible assets consisting of customer relationships. The goodwill arising from the acquisition largely relates to strategic benefits, product and market diversification, assembled workforce, and similar factors. For tax purposes, the goodwill is deductible over 15 years.
Revenuenet sales and operating income (loss) of Mount Hollythe acquired businesses included in our consolidated results of operations for 2021 totaled $10.1 millionin the three and $1.3 million, respectively. six months ended 2022:
Three months ended June 30, | Six months ended June 30, | ||||||||||
In thousands | 2022 | 2022 | |||||||||
Mount Holly | |||||||||||
Net sales | $ | 26,300 | $ | 53,604 | |||||||
Operating income | 1,911 | 4,635 | |||||||||
Jacob Holm | |||||||||||
Net sales | 96,917 | 193,304 | |||||||||
Operating loss | (1,808) | (3,380) |
(unaudited) |
| Three months ended June 30 |
|
|
| Six months ended June 30 |
|
| (unaudited) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||
In thousands, except per share |
|
| 2021 |
|
|
|
| 2020 |
|
|
|
| 2021 |
|
|
| 2020 |
|
| In thousands, except per share | 2021 | 2021 | |||||||||
Pro forma |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Pro forma | ||||||||||
Net sales |
| $ | 254,452 |
|
|
| $ | 241,641 |
|
|
| $ | 501,083 |
|
|
| $ | 498,352 |
|
| Net sales | $ | 347,895 | $ | 690,448 | ||||||
Income (loss) from continuing operations |
|
| (919 | ) |
|
|
| (766 | ) |
|
|
| 7,824 |
|
|
|
| 8,286 |
|
| Income (loss) from continuing operations | (10,546) | 12,892 | ||||||||
Income (loss) per share from continuing operations |
|
| (0.02 | ) |
|
|
| (0.02 | ) |
|
|
| 0.17 |
|
|
|
| 0.19 |
|
|
GLATFELTER
Form 10-Q
|
|
|
| Three months ended June 30 |
|
| Six months ended June 30 |
| ||||||||||
In thousands |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||
Composite Fibers |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food & beverage |
| $ | 73,535 |
|
| $ | 73,014 |
|
| $ | 150,488 |
|
| $ | 144,481 |
|
Wallcovering |
|
| 24,182 |
|
|
| 11,259 |
|
|
| 46,811 |
|
|
| 31,152 |
|
Technical specialties |
|
| 24,708 |
|
|
| 18,816 |
|
|
| 48,203 |
|
|
| 38,823 |
|
Composite laminates |
|
| 10,549 |
|
|
| 8,126 |
|
|
| 20,358 |
|
|
| 17,889 |
|
Metallized |
|
| 8,624 |
|
|
| 10,922 |
|
|
| 16,987 |
|
|
| 22,503 |
|
|
|
| 141,598 |
|
|
| 122,137 |
|
|
| 282,847 |
|
|
| 254,848 |
|
Airlaid Materials |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Feminine hygiene |
|
| 47,184 |
|
|
| 50,668 |
|
|
| 94,825 |
|
|
| 100,764 |
|
Specialty wipes |
|
| 21,371 |
|
|
| 20,947 |
|
|
| 37,287 |
|
|
| 38,159 |
|
Tabletop |
|
| 17,188 |
|
|
| 5,529 |
|
|
| 24,051 |
|
|
| 20,581 |
|
Adult incontinence |
|
| 5,083 |
|
|
| 5,011 |
|
|
| 9,761 |
|
|
| 11,156 |
|
Home care |
|
| 6,339 |
|
|
| 6,278 |
|
|
| 10,262 |
|
|
| 11,490 |
|
Other |
|
| 6,148 |
|
|
| 5,613 |
|
|
| 11,552 |
|
|
| 10,745 |
|
|
|
| 103,313 |
|
|
| 94,046 |
|
|
| 187,738 |
|
|
| 192,895 |
|
|
| $ | 244,911 |
|
| $ | 216,183 |
|
| $ | 470,585 |
|
| $ | 447,743 |
|
|
| Three months ended June 30 |
|
| Six months ended June 30 |
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||||||
In thousands |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| In thousands | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Revenue by product category | Revenue by product category | ||||||||||||||||||||||||||||||||||||||
Composite Fibers | Composite Fibers | ||||||||||||||||||||||||||||||||||||||
Food & beverage | Food & beverage | $ | 74,465 | $ | 73,535 | $ | 149,688 | $ | 150,488 | ||||||||||||||||||||||||||||||
Wallcovering | Wallcovering | 9,902 | 24,182 | 25,733 | 46,811 | ||||||||||||||||||||||||||||||||||
Technical specialties | Technical specialties | 18,603 | 24,708 | 41,739 | 48,203 | ||||||||||||||||||||||||||||||||||
Composite laminates | Composite laminates | 11,570 | 10,549 | 22,867 | 20,358 | ||||||||||||||||||||||||||||||||||
Metallized | Metallized | 8,798 | 8,624 | 19,140 | 16,987 | ||||||||||||||||||||||||||||||||||
123,338 | 141,598 | 259,167 | 282,847 | ||||||||||||||||||||||||||||||||||||
Airlaid Materials | Airlaid Materials | ||||||||||||||||||||||||||||||||||||||
Feminine hygiene | Feminine hygiene | 56,943 | 47,184 | 116,255 | 94,825 | ||||||||||||||||||||||||||||||||||
Specialty wipes | Specialty wipes | 37,908 | 21,371 | 75,003 | 37,287 | ||||||||||||||||||||||||||||||||||
Tabletop | Tabletop | 26,771 | 17,188 | 57,518 | 24,051 | ||||||||||||||||||||||||||||||||||
Food pads | Food pads | 3,475 | 2,440 | 6,951 | 4,797 | ||||||||||||||||||||||||||||||||||
Home care | Home care | 5,513 | 6,339 | 11,798 | 10,262 | ||||||||||||||||||||||||||||||||||
Adult incontinence | Adult incontinence | 6,260 | 5,083 | 12,989 | 9,761 | ||||||||||||||||||||||||||||||||||
Other | Other | 6,838 | 3,708 | 12,658 | 6,755 | ||||||||||||||||||||||||||||||||||
143,708 | 103,313 | 293,172 | 187,738 | ||||||||||||||||||||||||||||||||||||
Spunlace | Spunlace | ||||||||||||||||||||||||||||||||||||||
Consumer wipes | Consumer wipes | 39,549 | — | 85,706 | — | ||||||||||||||||||||||||||||||||||
Critical cleaning | Critical cleaning | 27,783 | — | 52,061 | — | ||||||||||||||||||||||||||||||||||
Health care | Health care | 15,434 | — | 29,039 | — | ||||||||||||||||||||||||||||||||||
Hygiene | Hygiene | 6,233 | — | 12,146 | — | ||||||||||||||||||||||||||||||||||
High performance | High performance | 4,018 | — | 8,130 | — | ||||||||||||||||||||||||||||||||||
Beauty care | Beauty care | 3,900 | — | 6,222 | — | ||||||||||||||||||||||||||||||||||
96,917 | — | 193,304 | — | ||||||||||||||||||||||||||||||||||||
Total | Total | $ | 363,963 | $ | 244,911 | $ | 745,643 | $ | 470,585 | ||||||||||||||||||||||||||||||
Revenue by geography | Revenue by geography | ||||||||||||||||||||||||||||||||||||||
Composite Fibers |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Composite Fibers | ||||||||||||||||||||||
Europe, Middle East and Africa |
| $ | 85,796 |
|
| $ | 68,807 |
|
| $ | 172,741 |
|
| $ | 148,402 |
| Europe, Middle East and Africa | $ | 59,868 | $ | 85,796 | $ | 133,472 | $ | 172,741 | ||||||||||||||
Americas |
|
| 35,369 |
|
|
| 33,352 |
|
|
| 67,210 |
|
|
| 66,073 |
| Americas | 42,077 | 35,369 | 80,053 | 67,210 | ||||||||||||||||||
Asia Pacific |
|
| 20,433 |
|
|
| 19,978 |
|
|
| 42,896 |
|
|
| 40,373 |
| Asia Pacific | 21,393 | 20,433 | 45,642 | 42,896 | ||||||||||||||||||
|
|
| 141,598 |
|
|
| 122,137 |
|
|
| 282,847 |
|
|
| 254,848 |
| |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 123,338 | 141,598 | 259,167 | 282,847 | |||||||||||||||||||
Airlaid Materials |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Airlaid Materials | ||||||||||||||||||||||
Europe, Middle East and Africa |
|
| 49,552 |
|
|
| 45,879 |
|
|
| 94,624 |
|
|
| 98,599 |
| Europe, Middle East and Africa | 63,355 | 49,552 | 126,491 | 94,624 | ||||||||||||||||||
Americas |
|
| 52,031 |
|
|
| 45,262 |
|
|
| 89,516 |
|
|
| 89,648 |
| Americas | 77,608 | 52,031 | 158,521 | 89,516 | ||||||||||||||||||
Asia Pacific |
|
| 1,730 |
|
|
| 2,905 |
|
|
| 3,598 |
|
|
| 4,648 |
| Asia Pacific | 2,745 | 1,730 | 8,160 | 3,598 | ||||||||||||||||||
|
|
| 103,313 |
|
|
| 94,046 |
|
|
| 187,738 |
|
|
| 192,895 |
| 143,708 | 103,313 | 293,172 | 187,738 | |||||||||||||||||||
Spunlace | Spunlace | ||||||||||||||||||||||||||||||||||||||
Europe, Middle East and Africa | Europe, Middle East and Africa | 30,245 | — | 60,070 | — | ||||||||||||||||||||||||||||||||||
Americas | Americas | 54,985 | — | 110,469 | — | ||||||||||||||||||||||||||||||||||
Asia Pacific | Asia Pacific | 11,687 | — | 22,765 | — | ||||||||||||||||||||||||||||||||||
|
| $ | 244,911 |
|
| $ | 216,183 |
|
| $ | 470,585 |
|
| $ | 447,743 |
| |||||||||||||||||||||||
96,917 | — | 193,304 | — | ||||||||||||||||||||||||||||||||||||
Total | Total | $ | 363,963 | $ | 244,911 | $ | 745,643 | $ | 470,585 |
|
|
|
| Three months ended June 30 |
|
|
| Six months ended June 30 |
|
| ||
In thousands |
| 2020 |
|
|
| 2020 |
|
| ||
Severance and benefit continuation |
| $ | 2,689 |
|
|
| $ | 6,143 |
|
|
Accelerated depreciation |
|
| 1,352 |
|
|
|
| 3,885 |
|
|
Inventory and spare parts |
|
| 935 |
|
|
|
| 935 |
|
|
Other |
|
| 91 |
|
|
|
| 91 |
|
|
Total |
| $ | 5,067 |
|
|
| $ | 11,054 |
|
|
GLATFELTER
Form 10-Q
|
|
During the second quarter of 2020, in
|
|
Dollars in thousands |
| Acres |
|
| Proceeds |
|
| Gain |
|
| |||
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Timberlands |
| 936 |
|
| $ | 2,510 |
|
| $ | 2,403 |
|
| |
Other |
| n/a |
|
|
| — |
|
|
| — |
|
| |
Total |
|
|
|
|
| $ | 2,510 |
|
| $ | 2,403 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Timberlands |
|
| 216 |
|
| $ | 613 |
|
| $ | 601 |
|
|
Other |
| n/a |
|
|
| — |
|
|
| (4 | ) |
| |
Total |
|
|
|
|
| $ | 613 |
|
| $ | 597 |
|
|
Dollars in thousands | Acres | Proceeds | Gain (loss) | ||||||||||||||
2022 | |||||||||||||||||
Timberlands | 790 | $ | 3,130 | $ | 2,962 | ||||||||||||
Other | n/a | 43 | (74) | ||||||||||||||
Total | $ | 3,173 | $ | 2,888 | |||||||||||||
2021 | |||||||||||||||||
Timberlands | 936 | $ | 2,510 | $ | 2,403 | ||||||||||||
Other | n/a | — | — | ||||||||||||||
Total | $ | 2,510 | $ | 2,403 |
|
| |||||||
In thousands | Six months ended June 30, | |||||||
Machinery and equipment | $ | 27,619 | ||||||
Technological know-how | 18,443 | |||||||
Customer relationships | 11,695 | |||||||
Tradename | 3,530 | |||||||
Goodwill | 56,062 | |||||||
Total | $ | 117,349 |
On October 31, 2018,
wallcover products.
is primarily related to legal costs.
|
| Six months ended June 30 |
|
| Six months ended June 30, | |||||||||||||||
In thousands |
| 2021 |
|
| 2020 |
|
| In thousands | 2022 | 2021 | ||||||||||
Net cash used by operating activities |
| $ | (238 | ) |
| $ | (945 | ) |
| Net cash used by operating activities | $ | (231) | $ | (238) | ||||||
Net cash used by investing activities |
|
| — |
|
|
| — |
|
| Net cash used by investing activities | — | — | ||||||||
Net cash provided by financing activities |
|
| — |
|
|
| — |
|
| Net cash provided by financing activities | — | — | ||||||||
Change in cash and cash equivalents from discontinued operations |
| $ | (238 | ) |
| $ | (945 | ) |
| Change in cash and cash equivalents from discontinued operations | $ | (231) | $ | (238) |
- 10 -
GLATFELTER
Form 10-Q
|
|
|
| Three months ended June 30 |
|
| Six months ended June 30 |
|
| ||||||||||||
In thousands, except per share |
| 2021 |
|
|
| 2020 |
|
| 2021 |
|
|
| 2020 |
|
| ||||
Income (loss) from continuing operations |
| $ | 1,492 |
|
|
| $ | (2,281 | ) |
| $ | 9,886 |
|
|
| $ | 5,125 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding used in basic EPS |
|
| 44,563 |
|
|
|
| 44,343 |
|
|
| 44,507 |
|
|
|
| 44,309 |
|
|
Common shares issuable upon exercise of dilutive stock options and PSAs / RSUs |
|
| 309 |
|
|
|
| — |
|
|
| 358 |
|
|
|
| 232 |
|
|
Weighted average common shares outstanding and common share equivalents used in diluted EPS |
|
| 44,872 |
|
|
|
| 44,343 |
|
|
| 44,865 |
|
|
|
| 44,541 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
| $ | 0.03 |
|
|
| $ | (0.05 | ) |
| $ | 0.22 |
|
|
| $ | 0.12 |
|
|
Diluted |
|
| 0.03 |
|
|
|
| (0.05 | ) |
|
| 0.22 |
|
|
|
| 0.12 |
|
|
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
In thousands, except per share | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Income (loss) from continuing operations | $ | (2,460) | $ | 1,492 | $ | (110,750) | $ | 9,886 | |||||||||||||||
Weighted average common shares outstanding used in basic EPS | 44,841 | 44,563 | 44,775 | 44,507 | |||||||||||||||||||
Common shares issuable upon exercise of dilutive stock options and PSAs / RSUs | — | 309 | — | 358 | |||||||||||||||||||
Weighted average common shares outstanding and common share equivalents used in diluted EPS | 44,841 | 44,872 | 44,775 | 44,865 | |||||||||||||||||||
Earnings (loss) per share from continuing operations | |||||||||||||||||||||||
Basic | $ | (0.05) | $ | 0.03 | $ | (2.47) | $ | 0.22 | |||||||||||||||
Diluted | (0.05) | 0.03 | (2.47) | 0.22 |
|
| Three months ended June 30 |
|
| Six months ended June 30 |
|
| ||||||||||||
In thousands |
| 2021 |
|
|
| 2020 |
|
| 2021 |
|
|
| 2020 |
|
| ||||
Potential common shares |
|
| 1,082 |
|
|
|
| 1,129 |
|
|
| 1,082 |
|
|
|
| 1,129 |
|
|
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
In thousands | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Potential common shares | 934 | 1,082 | 934 | 1,082 |
GLATFELTER
Form 10-Q
|
|
In thousands | Currency translation adjustments |
|
| Unrealized gain (loss) on cash flow hedges |
|
| Change in pensions |
|
| Change in other postretirement defined benefit plans |
|
| Total |
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at April 1, 2021 | $ | (55,718 | ) |
| $ | 765 |
|
| $ | (12,706 | ) |
| $ | (834 | ) |
| $ | (68,493 | ) |
|
Other comprehensive income (loss) before reclassifications (net of tax) |
| 3,846 |
|
|
| (341 | ) |
|
| — |
|
|
| — |
|
|
| 3,505 |
|
|
Amounts reclassified from accumulated other comprehensive income (net of tax) |
| — |
|
|
| 25 |
|
|
| 197 |
|
|
| (47 | ) |
|
| 175 |
|
|
Net current period other comprehensive income (loss) |
| 3,846 |
|
|
| (316 | ) |
|
| 197 |
|
|
| (47 | ) |
|
| 3,680 |
|
|
Balance at June 30, 2021 | $ | (51,872 | ) |
| $ | 449 |
|
| $ | (12,509 | ) |
| $ | (881 | ) |
| $ | (64,813 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at April 1, 2020 | $ | (90,249 | ) |
| $ | 2,999 |
|
| $ | (7,105 | ) |
| $ | 1,138 |
|
| $ | (93,217 | ) |
|
Other comprehensive income before reclassifications (net of tax) |
| 5,891 |
|
|
| 516 |
|
|
| — |
|
|
| — |
|
|
| 6,407 |
|
|
Amounts reclassified from accumulated other comprehensive income (net of tax) |
| — |
|
|
| (1,068 | ) |
|
| 149 |
|
|
| (248 | ) |
|
| (1,167 | ) |
|
Net current period other comprehensive income (loss) |
| 5,891 |
|
|
| (552 | ) |
|
| 149 |
|
|
| (248 | ) |
|
| 5,240 |
|
|
Balance at June 30, 2020 | $ | (84,358 | ) |
| $ | 2,447 |
|
| $ | (6,956 | ) |
| $ | 890 |
|
| $ | (87,977 | ) |
|
In thousands | In thousands | Currency translation adjustments | Unrealized gain (loss) on derivatives | Change in pensions | Change in other postretirement defined benefit plans | Total | |||||||||||||||||||||||||||||||||||||||||||
Balance at April 1, 2022 | Balance at April 1, 2022 | $ | (80,672) | $ | 1,631 | $ | (11,356) | $ | (1,027) | $ | (91,424) | ||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications (net of tax) | Other comprehensive income (loss) before reclassifications (net of tax) | (28,675) | 9,760 | — | — | (18,915) | |||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (net of tax) | Amounts reclassified from accumulated other comprehensive income (net of tax) | — | (1,226) | 126 | 26 | (1,074) | |||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive income (loss) | Net current period other comprehensive income (loss) | (28,675) | 8,534 | 126 | 26 | (19,989) | |||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | Balance at June 30, 2022 | $ | (109,347) | $ | 10,165 | $ | (11,230) | $ | (1,001) | $ | (111,413) | ||||||||||||||||||||||||||||||||||||||
Balance at April 1, 2021 | Balance at April 1, 2021 | $ | (55,718) | $ | 765 | $ | (12,706) | $ | (834) | $ | (68,493) | ||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications (net of tax) | Other comprehensive income (loss) before reclassifications (net of tax) | 3,846 | (341) | — | — | 3,505 | |||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (net of tax) | Amounts reclassified from accumulated other comprehensive income (net of tax) | — | 25 | 197 | (47) | 175 | |||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive income (loss) | Net current period other comprehensive income (loss) | 3,846 | (316) | 197 | (47) | 3,680 | |||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2021 | Balance at June 30, 2021 | $ | (51,872) | $ | 449 | $ | (12,509) | $ | (881) | $ | (64,813) | ||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2022 | Balance at January 1, 2022 | $ | (69,757) | $ | 1,988 | $ | (11,482) | $ | (1,053) | $ | (80,304) | ||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications (net of tax) | Other comprehensive income (loss) before reclassifications (net of tax) | (39,590) | 10,143 | — | — | (29,447) | |||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (net of tax) | Amounts reclassified from accumulated other comprehensive income (net of tax) | — | (1,966) | 252 | 52 | (1,662) | |||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive income (loss) | Net current period other comprehensive income (loss) | (39,590) | 8,177 | 252 | 52 | (31,109) | |||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | Balance at June 30, 2022 | $ | (109,347) | $ | 10,165 | $ | (11,230) | $ | (1,001) | $ | (111,413) | ||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||
Balance at January 1, 2021 | $ | (42,525 | ) |
| $ | (2,496 | ) |
| $ | (12,844 | ) |
| $ | (788 | ) |
| $ | (58,653 | ) |
| Balance at January 1, 2021 | $ | (42,525) | $ | (2,496) | $ | (12,844) | $ | (788) | $ | (58,653) | ||||||||||||||||||
Other comprehensive income (loss) before reclassifications (net of tax) |
| (9,347 | ) |
|
| 2,933 |
|
|
| — |
|
|
| — |
|
|
| (6,414 | ) |
| Other comprehensive income (loss) before reclassifications (net of tax) | (9,347) | 2,933 | — | — | (6,414) | |||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (net of tax) |
| — |
|
|
| 12 |
|
|
| 335 |
|
|
| (93 | ) |
|
| 254 |
|
| Amounts reclassified from accumulated other comprehensive income (net of tax) | — | 12 | 335 | (93) | 254 | |||||||||||||||||||||||
Net current period other comprehensive income (loss) |
| (9,347 | ) |
|
| 2,945 |
|
|
| 335 |
|
|
| (93 | ) |
|
| (6,160 | ) |
| Net current period other comprehensive income (loss) | (9,347) | 2,945 | 335 | (93) | (6,160) | |||||||||||||||||||||||
Balance at June 30, 2021 | $ | (51,872 | ) |
| $ | 449 |
|
| $ | (12,509 | ) |
| $ | (881 | ) |
| $ | (64,813 | ) |
| Balance at June 30, 2021 | $ | (51,872) | $ | 449 | $ | (12,509) | $ | (881) | $ | (64,813) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||
Balance at January 1, 2020 | $ | (76,346 | ) |
| $ | 4,316 |
|
| $ | (7,253 | ) |
| $ | 1,387 |
|
| $ | (77,896 | ) |
| |||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications (net of tax) |
| (8,012 | ) |
|
| 799 |
|
|
| — |
|
|
| — |
|
|
| (7,213 | ) |
| |||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (net of tax) |
| — |
|
|
| (2,668 | ) |
|
| 297 |
|
|
| (497 | ) |
|
| (2,868 | ) |
| |||||||||||||||||||||||||||||
Net current period other comprehensive income (loss) |
| (8,012 | ) |
|
| (1,869 | ) |
|
| 297 |
|
|
| (497 | ) |
|
| (10,081 | ) |
| |||||||||||||||||||||||||||||
Balance at June 30, 2020 | $ | (84,358 | ) |
| $ | 2,447 |
|
| $ | (6,956 | ) |
| $ | 890 |
|
| $ | (87,977 | ) |
|
GLATFELTER
Form 10-Q
|
| Three months ended June 30 |
|
| Six months ended June 30 |
|
|
| ||||||||||
In thousands |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
|
| ||||
Description |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Line Item in Statements of Income |
Cash flow hedges (Note 20) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Gains) losses on cash flow hedges |
| $ | 33 |
|
| $ | (1,488 | ) |
| $ | 57 |
|
| $ | (3,670 | ) |
| Costs of products sold |
Tax expense (benefit) |
|
| (22 | ) |
|
| 420 |
|
|
| (73 | ) |
|
| 1,002 |
|
| Income tax provision |
Net of tax |
|
| 11 |
|
|
| (1,068 | ) |
|
| (16 | ) |
|
| (2,668 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on interest rate swaps |
|
| 22 |
|
|
| — |
|
|
| 43 |
|
|
| — |
|
| Interest expense |
Tax benefit |
|
| (8 | ) |
|
| — |
|
|
| (15 | ) |
|
| — |
|
| Income tax provision |
Net of tax |
|
| 14 |
|
|
| — |
|
|
| 28 |
|
|
| — |
|
|
|
Total cash flow hedges |
|
| 25 |
|
|
| (1,068 | ) |
|
| 12 |
|
|
| (2,668 | ) |
|
|
Retirement plan obligations (Note 12) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of deferred benefit pension plans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prior service costs |
|
| 12 |
|
|
| 11 |
|
|
| 24 |
|
|
| 23 |
|
| Other, net |
Actuarial losses |
|
| 199 |
|
|
| 161 |
|
|
| 398 |
|
|
| 321 |
|
| Other, net |
|
|
| 211 |
|
|
| 172 |
|
|
| 422 |
|
|
| 344 |
|
|
|
Tax benefit |
|
| (14 | ) |
|
| (23 | ) |
|
| (87 | ) |
|
| (47 | ) |
| Income tax provision |
Net of tax |
|
| 197 |
|
|
| 149 |
|
|
| 335 |
|
|
| 297 |
|
|
|
Amortization of deferred benefit other plans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prior service costs |
|
| (59 | ) |
|
| (116 | ) |
|
| (117 | ) |
|
| (232 | ) |
| Other, net |
Actuarial gains |
|
| 12 |
|
|
| (208 | ) |
|
| 24 |
|
|
| (417 | ) |
| Other, net |
|
|
| (47 | ) |
|
| (324 | ) |
|
| (93 | ) |
|
| (649 | ) |
|
|
Tax expense |
|
| — |
|
| 76 |
|
|
| — |
|
| 152 |
|
| Income tax provision | ||
Net of tax |
|
| (47 | ) |
|
| (248 | ) |
|
| (93 | ) |
|
| (497 | ) |
|
|
Total reclassifications, net of tax |
| $ | 175 |
|
| $ | (1,167 | ) |
| $ | 254 |
|
| $ | (2,868 | ) |
|
|
11.
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||||||
In thousands | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||
Description | Line Item in Statements of Income | |||||||||||||||||||||||||||||||
Cash flow hedges (Note 18) | ||||||||||||||||||||||||||||||||
Loss (gains) on cash flow hedges | $ | (1,697) | $ | 33 | $ | (2,769) | $ | 57 | Costs of products sold | |||||||||||||||||||||||
Tax expense (benefit) | 480 | (22) | 792 | (73) | Income tax provision | |||||||||||||||||||||||||||
Net of tax | (1,217) | 11 | (1,977) | (16) | ||||||||||||||||||||||||||||
Loss (gains) on interest rate swaps | (9) | 22 | 11 | 43 | Interest expense | |||||||||||||||||||||||||||
Tax benefit | — | (8) | — | (15) | Income tax provision | |||||||||||||||||||||||||||
Net of tax | (9) | 14 | 11 | 28 | ||||||||||||||||||||||||||||
Total cash flow hedges | (1,226) | 25 | (1,966) | 12 | ||||||||||||||||||||||||||||
Retirement plan obligations (Note 11) | ||||||||||||||||||||||||||||||||
Amortization of deferred benefit pension plans | ||||||||||||||||||||||||||||||||
Prior service costs | 11 | 12 | 22 | 24 | Other, net | |||||||||||||||||||||||||||
Actuarial losses | 164 | 199 | 331 | 398 | Other, net | |||||||||||||||||||||||||||
175 | 211 | 353 | 422 | |||||||||||||||||||||||||||||
Tax benefit | (49) | (14) | (101) | (87) | Income tax provision | |||||||||||||||||||||||||||
Net of tax | 126 | 197 | 252 | 335 | ||||||||||||||||||||||||||||
Amortization of deferred benefit other plans | ||||||||||||||||||||||||||||||||
Prior service costs (credits) | 26 | (59) | 52 | (117) | Other, net | |||||||||||||||||||||||||||
Actuarial losses | — | 12 | — | 24 | Other, net | |||||||||||||||||||||||||||
26 | (47) | 52 | (93) | |||||||||||||||||||||||||||||
Tax expense | — | — | — | — | Income tax provision | |||||||||||||||||||||||||||
Net of tax | 26 | (47) | 52 | (93) | ||||||||||||||||||||||||||||
Total reclassifications, net of tax | $ | (1,074) | $ | 175 | $ | (1,662) | $ | 254 |
The
Furthermore, the LTIP increases the number shares previously available for issuance by 1,400,000 shares. As of June 30, 2022, there were 2,670,523 shares of common stock available for future issuance under the LTIP.
- 13 -
GLATFELTER
Form 10-Q
Units |
| 2021 |
|
|
| 2020 |
| ||
Balance at January 1, |
|
| 1,071,652 |
|
|
|
| 896,463 |
|
Granted |
|
| 352,763 |
|
|
|
| 369,975 |
|
Forfeited |
|
| (98,012 | ) |
|
|
| (81,046 | ) |
Shares delivered |
|
| (196,637 | ) |
|
|
| (136,182 | ) |
Balance at June 30, |
|
| 1,129,766 |
|
|
|
| 1,049,210 |
|
Units | 2022 | 2021 | |||||||||
Balance at January 1, | 1,111,382 | 1,071,652 | |||||||||
Granted | 718,668 | 352,763 | |||||||||
Forfeited | (215,656) | (98,012) | |||||||||
Shares delivered | (305,739) | (196,637) | |||||||||
Balance at June 30, | 1,308,655 | 1,129,766 |
|
| June 30 |
| June 30, | ||||||||||||||||
In thousands |
| 2021 |
|
| 2020 |
| In thousands | 2022 | 2021 | |||||||||||
Three months ended |
| $ | 1,329 |
|
| $ | 1,292 |
| Three months ended | $ | 1,509 | $ | 1,329 | |||||||
Six months ended |
|
| 2,537 |
|
|
| 2,377 |
| Six months ended | $ | 2,418 | $ | 2,537 |
Stock Only
|
| 2021 |
|
| 2020 |
| |||||||||||
SOSARS |
| Shares |
|
|
| Wtd Avg Exercise Price |
|
| Shares |
|
| Wtd Avg Exercise Price |
| ||||
Outstanding at January 1, |
|
| 1,082,413 |
|
|
| $ | 20.40 |
|
|
| 1,291,947 |
|
| $ | 20.05 |
|
Granted |
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
Exercised |
|
| — |
|
|
|
| — |
|
|
| (58,460 | ) |
|
| 12.85 |
|
Canceled / forfeited |
|
| — |
|
|
|
| — |
|
|
| (104,801 | ) |
|
| 21.57 |
|
Outstanding at June 30, |
|
| 1,082,413 |
|
|
| $ | 20.40 |
|
|
| 1,128,686 |
|
| $ | 20.28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 | 2021 | ||||||||||||||||||||||
Shares | Wtd Avg Exercise Price | Shares | Wtd Avg Exercise Price | ||||||||||||||||||||
Outstanding at January 1, | 1,079,113 | $ | 20.42 | 1,082,413 | $ | 20.40 | |||||||||||||||||
Granted | — | — | — | — | |||||||||||||||||||
Exercised | — | — | — | — | |||||||||||||||||||
Canceled / forfeited | (145,440) | 15.61 | — | — | |||||||||||||||||||
Outstanding at June 30, | 933,673 | $ | 21.17 | 1,082,413 | $ | 20.40 |
|
| Three months ended June 30 |
|
| Six months ended June 30 | Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||||||||||
In thousands |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| In thousands | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||
Pension Benefits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Pension Benefits | ||||||||||||||||||||||||
Service cost |
| $ | — |
|
| $ | 48 |
|
| $ | — |
|
| $ | 92 |
|
| Service cost | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Interest cost |
|
| 273 |
|
|
| 300 |
|
|
| 523 |
|
|
| 601 |
|
| Interest cost | 179 | 273 | 414 | 523 | ||||||||||||||||||||
Amortization of prior service cost |
|
| 12 |
|
|
| 11 |
|
|
| 24 |
|
|
| 23 |
|
| Amortization of prior service cost | 11 | 12 | 22 | 24 | ||||||||||||||||||||
Amortization of actuarial loss |
|
| 199 |
|
|
| 161 |
|
|
| 398 |
|
|
| 321 |
|
| Amortization of actuarial loss | 164 | 199 | 331 | 398 | ||||||||||||||||||||
Total net periodic benefit expense |
| $ | 484 |
|
| $ | 520 |
|
| $ | 945 |
|
| $ | 1,037 |
|
| Total net periodic benefit expense | $ | 354 | $ | 484 | $ | 767 | $ | 945 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Other Benefits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other Benefits | ||||||||||||||||||||||||
Service cost |
| $ | 7 |
|
| $ | 7 |
|
| $ | 14 |
|
| $ | 14 |
|
| Service cost | $ | — | $ | 7 | $ | — | $ | 14 | ||||||||||||||||
Interest cost |
|
| 32 |
|
|
| 46 |
|
|
| 64 |
|
|
| 92 |
|
| Interest cost | 32 | 32 | 65 | 64 | ||||||||||||||||||||
Amortization of prior service credit |
|
| (59 | ) |
|
| (116 | ) |
|
| (117 | ) |
|
| (232 | ) |
| |||||||||||||||||||||||||
Amortization of prior service cost (credit) | Amortization of prior service cost (credit) | 26 | (59) | 52 | (117) | |||||||||||||||||||||||||||||||||||||
Amortization of actuarial loss |
|
| 12 |
|
|
| (208 | ) |
|
| 24 |
|
|
| (417 | ) |
| Amortization of actuarial loss | — | 12 | — | 24 | ||||||||||||||||||||
Total net periodic benefit income |
| $ | (8 | ) |
| $ | (271 | ) |
| $ | (15 | ) |
| $ | (543 | ) |
| |||||||||||||||||||||||||
Total net periodic benefit expense (income) | Total net periodic benefit expense (income) | $ | 58 | $ | (8) | $ | 117 | $ | (15) |
- 14 -
GLATFELTER
Form 10-Q
|
|
benefit.
We, or one of our subsidiaries, file income tax returns with the United States Internal Revenue Service, as well as various state and foreign authorities.
- 15 -
GLATFELTER
Form 10-Q
The following table summarizes, by major jurisdiction, tax years that remain subject to examination:
| ||||
|
|
| ||
| ||||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
|
|
|
The amount of income taxes we pay is subject to ongoing audits by federal, state and foreign tax authorities, which often result in proposed assessments. Management performs a comprehensive review of its global tax positions on a
We recognize interest and penalties related to uncertain tax
positions as income tax expense.
| Six months ended June 30 |
| Six months ended June 30, | ||||||||||||||||
In millions | 2021 |
|
|
| 2020 |
| In millions | 2022 | 2021 | ||||||||||
Interest expense (income) | $ | 0.4 |
|
|
| $ | 0.2 |
| |||||||||||
Interest expense | Interest expense | $ | 0.8 | $ | 0.4 |
| June 30 |
|
|
| December 31 |
| ||
| 2021 |
|
|
| 2020 |
| ||
Accrued interest payable | $ | 2.2 |
|
|
| $ | 1.8 |
|
June 30, 2022 | December 31, 2021 | ||||||||||
Accrued interest payable | $ | 4.7 | $ | 3.9 | |||||||
Accrued penalties | 3.0 | 3.0 |
|
|
|
| June 30 |
|
| December 31 |
| ||||||||||||||
In thousands |
| 2021 |
|
| 2020 |
| In thousands | June 30, 2022 | December 31, 2021 | |||||||||||
Raw materials |
| $ | 68,069 |
|
| $ | 55,466 |
| Raw materials | $ | 100,129 | $ | 87,448 | |||||||
In-process and finished |
|
| 105,064 |
|
|
| 97,109 |
| In-process and finished | 153,224 | 139,058 | |||||||||
Supplies |
|
| 47,073 |
|
|
| 43,655 |
| Supplies | 54,259 | 53,014 | |||||||||
Total |
| $ | 220,206 |
|
| $ | 196,230 |
| Total | $ | 307,612 | $ | 279,520 |
- 16 -
GLATFELTER
Form 10-Q
|
|
| December 31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30 |
|
| ||
In thousands | 2020 |
|
| Acquisitions |
|
| Amortization |
|
| Translation |
|
| 2021 |
|
| |||||
Goodwill |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Composite Fibers | $ | 84,586 |
|
| $ | — |
|
| $ | — |
|
| $ | (2,436 | ) |
| $ | 82,150 |
|
|
Airlaid Materials |
| 79,783 |
|
|
| 36,045 |
|
|
| — |
|
|
| (2,517 | ) |
|
| 113,311 |
|
|
Total | $ | 164,369 |
|
| $ | 36,045 |
|
| $ | — |
|
| $ | (4,953 | ) |
| $ | 195,461 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Intangible Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Composite Fibers |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tradename - non amortizing | $ | 3,902 |
|
| $ | — |
|
| $ | — |
|
| $ | (123 | ) |
| $ | 3,779 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Technology and related |
| 41,578 |
|
|
| — |
|
|
| — |
|
|
| (1,141 | ) |
|
| 40,437 |
|
|
Accumulated amortization |
| (18,636 | ) |
|
| — |
|
|
| (969 | ) |
|
| 432 |
|
|
| (19,173 | ) |
|
Net |
| 22,942 |
|
|
| — |
|
|
| (969 | ) |
|
| (709 | ) |
|
| 21,264 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer relationships and related |
| 37,535 |
|
|
| — |
|
|
| — |
|
|
| (1,111 | ) |
|
| 36,424 |
|
|
Accumulated amortization |
| (21,290 | ) |
|
| — |
|
|
| (1,262 | ) |
|
| 617 |
|
|
| (21,935 | ) |
|
Net |
| 16,245 |
|
|
| — |
|
|
| (1,262 | ) |
|
| (494 | ) |
|
| 14,489 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Airlaid Materials |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tradename |
| 3,960 |
|
|
| — |
|
|
| — |
|
|
| (125 | ) |
|
| 3,835 |
|
|
Accumulated amortization |
| (456 | ) |
|
| — |
|
|
| (97 | ) |
|
| 16 |
|
|
| (537 | ) |
|
Net |
| 3,504 |
|
|
| — |
|
|
| (97 | ) |
|
| (109 | ) |
|
| 3,298 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Technology and related |
| 20,053 |
|
|
| — |
|
|
| — |
|
|
| (615 | ) |
|
| 19,438 |
|
|
Accumulated amortization |
| (3,591 | ) |
|
| — |
|
|
| (645 | ) |
|
| 113 |
|
|
| (4,123 | ) |
|
Net |
| 16,462 |
|
|
| — |
|
|
| (645 | ) |
|
| (502 | ) |
|
| 15,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer relationships and related |
| 26,636 |
|
|
| 20,000 |
|
|
| — |
|
|
| (840 | ) |
|
| 45,796 |
|
|
Accumulated amortization |
| (7,856 | ) |
|
| — |
|
|
| (1,326 | ) |
|
| 263 |
|
|
| (8,919 | ) |
|
net |
| 18,780 |
|
|
| 20,000 |
|
|
| (1,326 | ) |
|
| (577 | ) |
|
| 36,877 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total intangibles |
| 133,664 |
|
|
| 20,000 |
|
|
| — |
|
|
| (3,955 | ) |
|
| 149,709 |
|
|
Total accumulated amortization |
| (51,829 | ) |
|
| — |
|
|
| (4,299 | ) |
|
| 1,441 |
|
|
| (54,687 | ) |
|
Net intangibles | $ | 81,835 |
|
| $ | 20,000 |
|
| $ | (4,299 | ) |
| $ | (2,514 | ) |
| $ | 95,022 |
|
|
As discussed in Note 3, “Acquisition”, we recorded $36.0 million of goodwill and $20.0 million of
|
|
In thousands | December 31, 2021 | Impairment | Purchase price allocation adjustment | Translation | June 30, 2022 | ||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||
Composite Fibers | $ | 78,438 | $ | (56,062) | $ | — | $ | (1,968) | $ | 20,408 | |||||||||||||||||||
Airlaid Materials | 109,486 | — | — | (6,105) | 103,381 | ||||||||||||||||||||||||
Spunlace | 48,241 | — | (500) | (3,242) | 44,499 | ||||||||||||||||||||||||
Total | $ | 236,165 | $ | (56,062) | $ | (500) | $ | (11,315) | $ | 168,288 | |||||||||||||||||||
Other Intangible Assets | December 31, 2021 | Impairment | Amortization | Translation | June 30, 2022 | ||||||||||||||||||||||||
Composite Fibers | |||||||||||||||||||||||||||||
Tradename - non-amortizing | $ | 3,601 | $ | (3,530) | $ | — | $ | (71) | $ | — | |||||||||||||||||||
Technology and related | 38,614 | (37,823) | — | (791) | — | ||||||||||||||||||||||||
Accumulated amortization | (19,224) | 19,380 | (424) | 268 | — | ||||||||||||||||||||||||
Net | 19,390 | (18,443) | (424) | (523) | — | ||||||||||||||||||||||||
Customer relationships and related | 34,739 | (34,046) | — | (693) | — | ||||||||||||||||||||||||
Accumulated amortization | (22,104) | 22,351 | (587) | 340 | — | ||||||||||||||||||||||||
Net | 12,635 | (11,695) | (587) | (353) | — | ||||||||||||||||||||||||
Airlaid Materials | |||||||||||||||||||||||||||||
Tradename | 4,485 | — | — | (1,133) | 3,352 | ||||||||||||||||||||||||
Accumulated amortization | (603) | — | (88) | 63 | (628) | ||||||||||||||||||||||||
Net | 3,882 | — | (88) | (1,070) | 2,724 | ||||||||||||||||||||||||
Technology and related | 17,825 | — | — | (756) | 17,069 | ||||||||||||||||||||||||
Accumulated amortization | (4,552) | — | (587) | 387 | (4,752) | ||||||||||||||||||||||||
Net | 13,273 | — | (587) | (369) | 12,317 | ||||||||||||||||||||||||
Customer relationships and related | 44,585 | — | (2,038) | 42,547 | |||||||||||||||||||||||||
Accumulated amortization | (10,512) | — | (1,864) | 895 | (11,481) | ||||||||||||||||||||||||
Net | 34,073 | — | (1,864) | (1,143) | 31,066 | ||||||||||||||||||||||||
Spunlace | |||||||||||||||||||||||||||||
Products and Tradenames | 27,623 | — | (1,638) | 25,985 | |||||||||||||||||||||||||
Accumulated amortization | (253) | — | (801) | 343 | (711) | ||||||||||||||||||||||||
Net | 27,370 | — | (801) | (1,295) | 25,274 | ||||||||||||||||||||||||
Technology and related | 14,547 | — | (862) | 13,685 | |||||||||||||||||||||||||
Accumulated amortization | (202) | — | (676) | 335 | (543) | ||||||||||||||||||||||||
Net | 14,345 | — | (676) | (527) | 13,142 | ||||||||||||||||||||||||
Customer relationships and related | 28,003 | — | (1,660) | 26,343 | |||||||||||||||||||||||||
Accumulated amortization | (268) | — | (846) | 344 | (770) | ||||||||||||||||||||||||
Net | 27,735 | — | (846) | (1,316) | 25,573 | ||||||||||||||||||||||||
Total intangibles | 214,022 | (75,399) | — | (9,642) | 128,981 | ||||||||||||||||||||||||
Total accumulated amortization | (57,718) | 41,731 | (5,873) | 2,975 | (18,885) | ||||||||||||||||||||||||
Net intangibles | $ | 156,304 | $ | (33,668) | $ | (5,873) | $ | (6,667) | $ | 110,096 |
- 17 -
GLATFELTER
Form 10-Q
based on information available at the commencement date in determining the lease liabilities as our leases generally do not provide an implicit rate. For purposes of recording the lease arrangement, the term of lease may include options to extend or terminate when we are reasonably certain that the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term.
|
| June 30 |
|
| December 31 |
|
| ||
Dollars in thousands |
| 2021 |
|
| 2020 |
|
| ||
Right of use asset |
| $ | 24,865 |
|
| $ | 11,789 |
|
|
Weighted average discount rate |
|
| 3.37 | % |
|
| 2.94 | % |
|
Weighted average remaining maturity (months) |
|
| 345 |
|
|
| 66 |
|
|
|
|
|
|
|
|
|
|
|
|
The following table sets forth operating lease expense for the periods indicated: | |||||||||
|
| June 30 |
|
| |||||
In thousands |
| 2021 |
|
| 2020 |
|
| ||
Three months ended |
| $ | 1,452 |
|
| $ | 1,443 |
|
|
Six months ended |
|
| 2,799 |
|
|
| 2,885 |
|
|
Dollars in thousands | June 30, 2022 | December 31, 2021 | |||||||||
Right of use asset | $ | 26,275 | $ | 27,186 | |||||||
Weighted average discount rate | 2.97 | % | 3.31 | % | |||||||
Weighted average remaining maturity (years) | 21.2 | 26.0 |
Six months ended June 30, | ||||||||||||||
In thousands | 2022 | 2021 | ||||||||||||
Three months ended | $ | 1,499 | $ | 1,452 | ||||||||||
Six months ended | $ | 2,920 | $ | 2,799 |
In thousands |
|
|
|
|
|
|
| In thousands | ||||
2021 |
|
|
| $ | 2,595 |
|
| |||||
2022 |
|
|
|
| 4,299 |
|
| 2022 | $ | 2,988 | ||
2023 |
|
|
|
| 2,868 |
|
| 2023 | 3,606 | |||
2024 |
|
|
|
| 2,280 |
|
| 2024 | 2,742 | |||
2025 |
|
|
|
| 1,962 |
|
| 2025 | 2,350 | |||
2026 | 2026 | 2,270 | ||||||||||
Thereafter |
|
|
|
| 40,437 |
|
| Thereafter | 22,416 |
In connection with the May 2021 Mount Holly acquisition, we assumed a long-term lease of the land on which the facility is situated. The lease obligation, including renewal options that are expected to be exercised, expires in
|
|
On March 30, 2021, through Glatfelter Gernsbach GmbH, a wholly-owned subsidiary, we borrowed $11.7 million from Commerzbank AG, a German financial institution. The non-amortizing borrowing bears a fixed-interest rate of 0.75% per annum and the loan matures on March 29, 2022. The proceeds were used for general corporate purposes.
|
|
|
| June 30 |
|
|
| December 31 |
| ||
In thousands |
| 2021 |
|
|
| 2020 |
| ||
Revolving credit facility, due Feb. 2024 |
| $ | 213,478 |
|
|
| $ | 36,813 |
|
Term loan, due Feb. 2024 |
|
| 235,303 |
|
|
|
| 249,715 |
|
2.40% Term Loan, due Jun. 2022 |
|
| 1,698 |
|
|
|
| 2,629 |
|
2.05% Term Loan, due Mar. 2023 |
|
| 11,100 |
|
|
|
| 14,737 |
|
1.30% Term Loan, due Jun. 2023 |
|
| 3,396 |
|
|
|
| 4,382 |
|
1.55% Term Loan, due Sep. 2025 |
|
| 6,189 |
|
|
|
| 7,143 |
|
Total long-term debt |
|
| 471,164 |
|
|
|
| 315,419 |
|
Less current portion |
|
| (24,267 | ) |
|
|
| (25,057 | ) |
Unamortized deferred issuance costs |
|
| (1,636 | ) |
|
|
| (1,898 | ) |
Long-term debt, net of current portion |
| $ | 445,261 |
|
|
| $ | 288,464 |
|
In thousands | June 30, 2022 | December 31, 2021 | |||||||||
Revolving credit facility, due Sep 2026 | $ | 81,161 | $ | 10,000 | |||||||
4.750% Senior Notes, due Oct 2029 | 500,000 | 500,000 | |||||||||
Term loan, due Feb 2024 | 194,237 | 218,026 | |||||||||
2.40% Term Loan, due Jun 2022 | — | 809 | |||||||||
2.05% Term Loan, due Mar 2023 | 4,158 | 7,556 | |||||||||
1.30% Term Loan, due Jun 2023 | 1,484 | 2,427 | |||||||||
1.55% Term Loan, due Sep 2025 | 4,137 | 5,204 | |||||||||
1.10% Term Loan, due Mar 2024 | 6,610 | 9,267 | |||||||||
0.57% Term Loan, due Jul 2023 | 20,774 | 22,652 | |||||||||
Total long-term debt | 812,561 | 775,941 | |||||||||
Less current portion | (22,117) | (26,437) | |||||||||
Unamortized deferred issuance costs | (11,418) | (11,429) | |||||||||
Long-term debt, net of current portion | $ | 779,026 | $ | 738,075 |
In connection with the Mount Holly acquisition, we borrowed $160.0 million under the Revolving Credit Facility.
- 18 -
GLATFELTER
Form 10-Q
Foriii) pledges as collateral substantially all U.S. dollar denominated borrowingsdomestic assets to secure obligations owed under the Revolving Credit Facility,Agreement. As amended, we are obligated to maintain a maximum ratio of consolidated total net debt to consolidated adjusted EBITDA of 6.75 to 1.0 until the borrowing rate is, at our option, either, (a)quarter ended December 31, 2023, after which the bank’s base rate which is equal to the greater of i) the prime rate; ii) the federal funds rate plus 50 basis points; or iii) the Euro-rate plus 100 basis points plus an applicable spread over either i), ii) or iii) ranging from 12.5 basis points to 100 basis points based on the Company’smaximum leverage ratio and its corporate credit ratings determined by Standard & Poor’s Rating Services and Moody’s Investor Service, Inc. (the “Corporate Credit Rating”); or (b) the Euro-rate plus an applicable margin ranging from 112.5 basis pointssteps down to 200 basis points based on the Company’s leverage ratio and the Corporate Credit Rating. For non-US dollar denominated borrowings, the borrowing rate is, at our option, based on (b) above or for Euro denominated borrowings, the Euro Interbank Offering Rate (“EURIBOR”) plus an applicable margin ranging from 112.5 basis points4.0 to 200 basis points based on the Company’s leverage ratio and the Corporate Credit Rating.
1.0.
All remaining principal outstanding and accrued interest under the Credit Agreement will be due and payable on February 8, 2024.
Glatfelter Gernsbach GmbH (“Gernsbach”), a wholly-owned subsidiary of ours, entered into a series of borrowing agreements with IKB Deutsche Industriebank AG, Düsseldorf (“IKB”) as summarized below:
Amounts in thousands |
| Original Principal |
|
|
| Interest Rate |
|
|
| Maturity | ||
Borrowing date |
|
|
|
|
|
|
|
|
|
|
|
|
Apr. 11, 2013 |
| € | 42,700 |
|
|
|
| 2.05 | % |
|
| Mar. 2023 |
Sep. 4, 2014 |
|
| 10,000 |
|
|
|
| 2.40 | % |
|
| Jun. 2022 |
Oct. 10, 2015 |
|
| 2,608 |
|
|
|
| 1.55 | % |
|
| Sep. 2025 |
Apr. 26, 2016 |
|
| 10,000 |
|
|
|
| 1.30 | % |
|
| Jun. 2023 |
May 4, 2016 |
|
| 7,195 |
|
|
|
| 1.55 | % |
|
| Sep. 2025 |
Each of the borrowings require quarterly repayments of principal and interest and provide for representations, warranties and covenants customary for financings of these types. The financial covenants contained in each of the IKB loans, which relate to the minimum ratio of consolidated EBITDA to consolidated interest expense and the maximum ratio of consolidated total net debt to consolidated adjusted EBITDA, are calculated by reference to our Credit Agreement.
Glatfelter Corporation guarantees all debt obligations of its subsidiaries. All such obligations are recorded in these condensed consolidated financial statements.
GLATFELTER
Form 10-Q
|
|
| June 30, 2021 |
|
|
| December 31, 2020 |
| ||||||||||
In thousands | Carrying Value |
|
| Fair Value |
|
|
| Carrying Value |
|
| Fair Value |
| ||||
Variable rate debt | $ | 213,478 |
|
| $ | 213,478 |
|
|
| $ | 36,813 |
|
| $ | 36,813 |
|
Term loan, due Feb. 2024 |
| 235,303 |
|
|
| 235,303 |
|
|
|
| 249,715 |
|
|
| 249,715 |
|
2.40% Term Loan |
| 1,698 |
|
|
| 1,713 |
|
|
|
| 2,629 |
|
|
| 2,651 |
|
2.05% Term Loan |
| 11,100 |
|
|
| 11,216 |
|
|
|
| 14,737 |
|
|
| 14,873 |
|
1.30% Term Loan |
| 3,396 |
|
|
| 3,407 |
|
|
|
| 4,382 |
|
|
| 4,384 |
|
1.55% Term Loan |
| 6,189 |
|
|
| 6,253 |
|
|
|
| 7,143 |
|
|
| 7,210 |
|
Total | $ | 471,164 |
|
| $ | 471,370 |
|
|
| $ | 315,419 |
|
| $ | 315,646 |
|
June 30, 2022 | December 31, 2021 | ||||||||||||||||||||||
In thousands | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||||||||
Variable rate debt | $ | 81,161 | $ | 81,161 | $ | 10,000 | $ | 10,000 | |||||||||||||||
4.750% Senior Notes, due Oct. 2029 | 500,000 | 348,750 | 500,000 | 516,875 | |||||||||||||||||||
Term loan, due Feb. 2024 | 194,237 | 194,237 | 218,026 | 218,026 | |||||||||||||||||||
2.40% Term Loan | — | — | 809 | 813 | |||||||||||||||||||
2.05% Term Loan | 4,158 | 4,162 | 7,556 | 7,616 | |||||||||||||||||||
1.30% Term Loan | 1,484 | 1,477 | 2,427 | 2,433 | |||||||||||||||||||
1.55% Term Loan | 4,137 | 4,047 | 5,204 | 5,234 | |||||||||||||||||||
1.10% Term Loan | 6,610 | 6,514 | 9,267 | 9,252 | |||||||||||||||||||
0.57% Term Loan | 20,774 | 20,484 | 22,652 | 22,657 | |||||||||||||||||||
Total | $ | 812,561 | $ | 660,832 | $ | 775,941 | $ | 792,906 |
|
|
In thousands |
| June 30, 2021 |
|
| December 31, 2020 |
| ||
Derivative |
|
|
|
|
|
|
|
|
Sell/Buy - sell notional |
|
|
|
|
|
|
|
|
Philippine Peso / Euro |
|
| 53,075 |
|
|
| 18,522 |
|
Euro / British Pound |
|
| 18,653 |
|
|
| 18,638 |
|
U.S. Dollar / British Pound |
|
| 11,634 |
|
|
| — |
|
U.S. Dollar / Euro |
|
| 658 |
|
|
| 1,041 |
|
Canadian Dollar / U.S. Dollar |
|
| — |
|
|
| 70 |
|
|
|
|
|
|
|
|
|
|
Sell/Buy - buy notional |
|
|
|
|
|
|
|
|
Euro / Philippine Peso |
|
| 924,747 |
|
|
| 853,686 |
|
British Pound / Philippine Peso |
|
| 1,096,306 |
|
|
| 1,081,791 |
|
Euro / U.S. Dollar |
|
| 88,426 |
|
|
| 69,324 |
|
U.S. Dollar / Canadian Dollar |
|
| 34,749 |
|
|
| 34,847 |
|
- 20 -
GLATFELTER
Form 10-Q
In October 2019,
In thousands | June 30, 2022 | December 31, 2021 | |||||||||
Derivative | |||||||||||
Sell/Buy - sell notional | |||||||||||
Euro / British Pound | 22,083 | 18,823 | |||||||||
U.S. Dollar / British Pound | 27,221 | 16,205 | |||||||||
U.S. Dollar / Euro | 3,402 | 658 | |||||||||
Sell/Buy - buy notional | |||||||||||
Euro / Philippine Peso | 965,540 | 896,291 | |||||||||
British Pound / Philippine Peso | 1,303,213 | 1,121,183 | |||||||||
Euro / U.S. Dollar | 107,614 | 108,467 | |||||||||
U.S. Dollar / Canadian Dollar | 36,493 | 36,904 | |||||||||
At termination, we recognized a deferred gain of $0.4 million that will be amortized into interest expense through December 2022.
In thousands |
| June 30, 2021 |
|
| December 31, 2020 |
| ||
Derivative |
|
|
|
|
|
|
|
|
Sell/Buy - sell notional |
|
|
|
|
|
|
|
|
U.S. Dollar / British Pound |
|
| 22,300 |
|
|
| 25,250 |
|
Euro / British Pound |
|
| — |
|
|
| 600 |
|
British Pound / Euro |
|
| 1,650 |
|
|
| 1,900 |
|
|
|
|
|
|
|
|
|
|
Sell/Buy - buy notional |
|
|
|
|
|
|
|
|
Euro / U.S. Dollar |
|
| 5,500 |
|
|
| 7,500 |
|
In thousands | June 30, 2022 | December 31, 2021 | |||||||||
Derivative | |||||||||||
Sell/Buy - sell notional | |||||||||||
U.S. Dollar / British Pound | 29,450 | 26,600 | |||||||||
British Pound / Euro | 2,800 | 3,400 | |||||||||
U.S. Dollar / Swiss Franc | 7,960 | 2,180 | |||||||||
British Pound / Swiss Franc | 2,290 | 1,025 | |||||||||
Euro / Swiss Franc | 6,520 | 2,750 | |||||||||
Euro / U.S. Dollar | 6,400 | 11,000 | |||||||||
Sell/Buy - buy notional | |||||||||||
Euro / U.S. Dollar | 2,700 | 20,900 | |||||||||
British Pound / Euro | 15,300 | 5,300 |
In thousands |
| June 30, 2021 |
|
| December 31, 2020 |
|
| June 30, 2021 |
|
| December 31, 2020 |
| ||||
|
| Prepaid Expenses and Other |
|
| Other |
| ||||||||||
Balance sheet caption |
| Current Assets |
|
| Current Liabilities |
| ||||||||||
Designated as hedging: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forward foreign currency exchange contracts |
| $ | 1,440 |
|
| $ | 577 |
|
| $ | 428 |
|
| $ | 4,342 |
|
Interest rate swap |
|
| — |
|
|
| — |
|
|
| 108 |
|
|
| 136 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Not designated as hedging: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forward foreign currency exchange contracts |
| $ | 118 |
|
| $ | 456 |
|
| $ | 452 |
|
| $ | 118 |
|
In thousands | June 30, 2022 | December 31, 2021 | June 30, 2022 | December 31, 2021 | |||||||||||||||||||
Balance sheet caption | Prepaid Expenses and Other Current Assets | Other Current Liabilities | |||||||||||||||||||||
Designated as hedging: | |||||||||||||||||||||||
Forward foreign currency exchange contracts | $ | 7,151 | $ | 3,197 | $ | 2,037 | $ | 288 | |||||||||||||||
Interest rate swap | — | — | — | 44 | |||||||||||||||||||
Not designated as hedging: | |||||||||||||||||||||||
Forward foreign currency exchange contracts | $ | 822 | 701 | $ | 1,124 | $ | 116 |
- 21 -
GLATFELTER
Form 10-Q
|
|
|
| Three months ended June 30 |
|
| Six months ended June 30 |
| ||||||||||
In thousands |
|
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||
Designated as hedging: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forward foreign currency exchange contracts: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold |
|
|
| $ | (33 | ) |
| $ | 1,488 |
|
| $ | (57 | ) |
| $ | 3,670 |
|
Interest expense |
|
|
|
| 22 |
|
|
| — |
|
|
| 43 |
|
|
| — |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Not designated as hedging: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forward foreign currency exchange contracts: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other – net |
|
|
| $ | 433 |
|
| $ | 92 |
|
| $ | 703 |
|
| $ | (527 | ) |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
In thousands | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Designated as hedging: | |||||||||||||||||||||||
Forward foreign currency exchange contracts: | |||||||||||||||||||||||
Cost of products sold | $ | (1,697) | $ | (33) | $ | (2,769) | $ | (57) | |||||||||||||||
Interest expense | (9) | 22 | 11 | 43 | |||||||||||||||||||
Not designated as hedging: | |||||||||||||||||||||||
Forward foreign currency exchange contracts: | |||||||||||||||||||||||
Other – net | $ | 1,289 | $ | 433 | $ | 1,729 | $ | 703 |
In thousands |
| 2021 |
|
| 2020 |
| ||
Balance at January 1, |
| $ | (3,460 | ) |
| $ | 5,859 |
|
Deferred gains on cash flow hedges |
|
| 4,117 |
|
|
| 1,103 |
|
Reclassified to earnings |
|
| 14 |
|
|
| (3,670 | ) |
Balance at June 30, |
| $ | 671 |
|
| $ | 3,292 |
|
In thousands | 2022 | 2021 | |||||||||
Balance at January 1, | $ | 2,889 | $ | (3,460) | |||||||
Deferred gains on cash flow hedges | 6,565 | 4,117 | |||||||||
Reclassified to earnings | (2,758) | 14 | |||||||||
Balance at June 30, | $ | 6,696 | $ | 671 |
- 22 -
GLATFELTER
Form 10-Q
|
|
|
| Six months ended June 30 |
| ||||||
In thousands |
|
| 2021 |
|
|
|
| 2020 |
|
Balance at January 1, |
| $ | 18,455 |
|
|
| $ | 21,870 |
|
Payments |
|
| (886 | ) |
|
|
| (2,234 | ) |
Accretion |
|
| 101 |
|
|
| 104 |
| |
Balance at June 30, |
| $ | 17,670 |
|
|
| $ | 19,740 |
|
The payments set forth above represent amounts due under the long-term monitoring and maintenance agreement. With respect to our total reserve for the Fox River, $3.2totaled $14.8 million at June 30, 2022, of which $2.2 million is recorded in the accompanying June 30, 20212022 condensed consolidated balance sheet under the caption “Environmental liabilities” and the remaining $14.5$12.6 million is recorded under the caption “Other long-term liabilities.”
GLATFELTER
Form 10-Q
|
|
Three months ended June 30 |
|
|
|
|
|
| Other and |
|
|
|
| ||||||||||||||||||||
Dollars in thousands | Composite Fibers |
|
| Airlaid Materials |
|
| Unallocated |
|
| Total |
| ||||||||||||||||||||
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||||||
Net sales | $ | 141,598 |
|
| $ | 122,137 |
|
| $ | 103,313 |
|
| $ | 94,046 |
|
| $ | — |
|
| $ | — |
|
| $ | 244,911 |
|
| $ | 216,183 |
|
Cost of products sold |
| 119,334 |
|
|
| 100,387 |
|
|
| 90,138 |
|
|
| 77,581 |
|
|
| (115 | ) |
|
| 6,152 |
|
|
| 209,357 |
|
|
| 184,120 |
|
Gross profit (loss) |
| 22,264 |
|
|
| 21,750 |
|
|
| 13,175 |
|
|
| 16,465 |
|
|
| 115 |
|
|
| (6,152 | ) |
|
| 35,554 |
|
|
| 32,063 |
|
SG&A |
| 11,201 |
|
|
| 10,263 |
|
|
| 4,744 |
|
|
| 4,173 |
|
|
| 13,039 |
|
|
| 9,115 |
|
|
| 28,984 |
|
|
| 23,551 |
|
Gains on dispositions of plant, equipment and timberlands, net |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1,553 | ) |
|
| (597 | ) |
|
| (1,553 | ) |
|
| (597 | ) |
Total operating income (loss) |
| 11,063 |
|
|
| 11,487 |
|
|
| 8,431 |
|
|
| 12,292 |
|
|
| (11,371 | ) |
|
| (14,670 | ) |
|
| 8,123 |
|
|
| 9,109 |
|
Non-operating expense |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2,610 | ) |
|
| (8,837 | ) |
|
| (2,610 | ) |
|
| (8,837 | ) |
Income (loss) before income taxes | $ | 11,063 |
|
| $ | 11,487 |
|
| $ | 8,431 |
|
| $ | 12,292 |
|
| $ | (13,981 | ) |
| $ | (23,507 | ) |
| $ | 5,513 |
|
| $ | 272 |
|
Supplementary Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net tons sold |
| 34,471 |
|
|
| 29,032 |
|
|
| 34,315 |
|
|
| 33,277 |
|
|
| — |
|
|
| — |
|
|
| 68,786 |
|
|
| 62,309 |
|
Depreciation, depletion and amortization ($ in thousands) (1) | $ | 7,000 |
|
| $ | 6,431 |
|
| $ | 6,767 |
|
| $ | 5,473 |
|
| $ | 966 |
|
| $ | 2,302 |
|
| $ | 14,733 |
|
| $ | 14,206 |
|
Capital expenditures |
| 2,882 |
|
|
| 2,105 |
|
|
| 1,297 |
|
|
| 1,712 |
|
|
| 1,653 |
|
|
| 1,180 |
|
|
| 5,832 |
|
|
| 4,997 |
|
Six months ended June 30 |
|
|
|
|
|
| Other and |
|
|
|
| ||||||||||||||||||||
Dollars in thousands | Composite Fibers |
|
| Airlaid Materials |
|
| Unallocated |
|
| Total |
| ||||||||||||||||||||
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||||||
Net sales | $ | 282,847 |
|
| $ | 254,848 |
|
| $ | 187,738 |
|
| $ | 192,895 |
|
| $ | — |
|
| $ | — |
|
| $ | 470,585 |
|
| $ | 447,743 |
|
Cost of products sold |
| 233,601 |
|
|
| 207,372 |
|
|
| 162,723 |
|
|
| 159,827 |
|
|
| (589 | ) |
|
| 11,679 |
|
|
| 395,735 |
|
|
| 378,878 |
|
Gross profit (loss) |
| 49,246 |
|
|
| 47,476 |
|
|
| 25,015 |
|
|
| 33,068 |
|
|
| 589 |
|
|
| (11,679 | ) |
|
| 74,850 |
|
|
| 68,865 |
|
SG&A |
| 22,118 |
|
|
| 20,887 |
|
|
| 9,387 |
|
|
| 8,754 |
|
|
| 20,306 |
|
|
| 18,431 |
|
|
| 51,811 |
|
|
| 48,072 |
|
Gains on dispositions of plant, equipment and timberlands, net |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2,403 | ) |
|
| (597 | ) |
|
| (2,403 | ) |
|
| (597 | ) |
Total operating income (loss) |
| 27,128 |
|
|
| 26,589 |
|
|
| 15,628 |
|
|
| 24,314 |
|
|
| (17,314 | ) |
|
| (29,513 | ) |
|
| 25,442 |
|
|
| 21,390 |
|
Non-operating expense |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (4,345 | ) |
|
| (11,104 | ) |
|
| (4,345 | ) |
|
| (11,104 | ) |
Income (loss) before income taxes | $ | 27,128 |
|
| $ | 26,589 |
|
| $ | 15,628 |
|
| $ | 24,314 |
|
| $ | (21,659 | ) |
| $ | (40,617 | ) |
| $ | 21,097 |
|
| $ | 10,286 |
|
Supplementary Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net tons sold |
| 68,611 |
|
|
| 65,015 |
|
|
| 63,179 |
|
|
| 68,316 |
|
|
| — |
|
|
| — |
|
|
| 131,790 |
|
|
| 133,331 |
|
Depreciation, depletion and amortization ($ in thousands) (1) | $ | 13,981 |
|
| $ | 12,897 |
|
| $ | 12,615 |
|
| $ | 10,924 |
|
| $ | 1,870 |
|
| $ | 5,787 |
|
| $ | 28,466 |
|
| $ | 29,608 |
|
Capital expenditures |
| 5,655 |
|
|
| 6,061 |
|
|
| 3,036 |
|
|
| 3,815 |
|
|
| 2,520 |
|
|
| 2,135 |
|
|
| 11,211 |
|
|
| 12,011 |
|
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
Dollars in thousands | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Net Sales | |||||||||||||||||||||||
Composite Fibers | $ | 123,338 | $ | 141,598 | $ | 259,167 | $ | 282,847 | |||||||||||||||
Airlaid Material | 143,708 | 103,313 | 293,172 | 187,738 | |||||||||||||||||||
Spunlace | 96,917 | — | 193,304 | — | |||||||||||||||||||
Total | $ | 363,963 | $ | 244,911 | $ | 745,643 | $ | 470,585 | |||||||||||||||
Operating income (loss) | |||||||||||||||||||||||
Composite Fibers | $ | 5,779 | $ | 11,063 | $ | 5,444 | $ | 27,128 | |||||||||||||||
Airlaid Material | 11,944 | 8,431 | 24,165 | 15,628 | |||||||||||||||||||
Spunlace | (1,808) | — | (3,380) | — | |||||||||||||||||||
Other and unallocated | (6,991) | (11,371) | (133,194) | (17,314) | |||||||||||||||||||
Total | $ | 8,924 | $ | 8,123 | $ | (106,965) | $ | 25,442 | |||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||
Composite Fibers | $ | 4,796 | $ | 7,000 | $ | 11,315 | $ | 13,981 | |||||||||||||||
Airlaid Material | 7,542 | 6,767 | 15,171 | 12,615 | |||||||||||||||||||
Spunlace | 2,945 | — | 5,859 | — | |||||||||||||||||||
Other and unallocated | 1,169 | 966 | 2,591 | 1,870 | |||||||||||||||||||
Total | $ | 16,452 | $ | 14,733 | $ | 34,936 | $ | 28,466 | |||||||||||||||
Capital expenditures | |||||||||||||||||||||||
Composite Fibers | $ | 4,131 | $ | 2,882 | $ | 10,258 | $ | 5,655 | |||||||||||||||
Airlaid Material | 2,064 | 1,297 | 5,532 | 3,036 | |||||||||||||||||||
Spunlace | 1,801 | — | 3,886 | — | |||||||||||||||||||
Other and unallocated | 2,353 | 1,653 | 3,021 | 2,520 | |||||||||||||||||||
Total | 10,349 | 5,832 | $ | 22,697 | $ | 11,211 | |||||||||||||||||
Tons shipped (metric) | |||||||||||||||||||||||
Composite Fibers | 24,246 | 34,471 | 52,457 | 68,611 | |||||||||||||||||||
Airlaid Material | 40,681 | 34,315 | 83,733 | 63,179 | |||||||||||||||||||
Spunlace | 19,358 | — | 40,094 | — | |||||||||||||||||||
Total | 84,285 | 68,786 | 176,284 | 131,790 |
|
|
Segments Results of individual operating segments are presented based on our management accounting practices and management structure. There is no comprehensive, authoritative body of guidance for management accounting equivalent to accounting principles generally accepted in the United States of America; therefore, the financial results of individual segments are not necessarily comparable with similar information for any other company. The management accounting process uses assumptions and allocations to measure performance of the segments. Methodologies are refined from time to time as management accounting practices are enhanced and businesses change. The costs incurred by support areas not directly aligned with the segment are allocated primarily based on an estimated utilization of support area services or are included in “Other and Unallocated” in the table set forth above.
GLATFELTER
Form 10-Q
|
|
On July 22, 2021, we enteredintoadefinitiveagreementtoacquire Jacob Holm,aglobal leading manufacturerof premium quality spunlace nonwoven fabrics for critical cleaning, high-performance materials, personal care, hygiene and medical applications, for approximately $308million for the outstanding shares and the extinguishment of Jacob Holm’s debt and subject to post-closing adjustments.
Jacob Holm’s broadproductofferingsandblue-chipcustomerbasewillexpand Glatfelter’s portfolio to include surgical drapes and gowns, wound care, face masks, facial wipes and cosmetic masks. The acquisition of Jacob Holm’sSontarabusiness,aleadingbrandoffinished products for critical cleaning wipes and medical apparel, will also enhanceGlatfelter’stechnologicalcapabilities. Jacob Holm generated approximately $400 million in revenue and about $45 million of EBITDA on a trailing twelve-month basis as of June 30, 2021, supported by strong pandemic tailwinds.
The transaction is subject to the satisfaction of customary closing conditions, including receipt of required regulatory clearances, and is expected to be completed later in 2021.
- 25 -
GLATFELTER
Form 10-Q
10-K ("2021 Form 10-K").
| i.risks related to the military conflict between Russia and Ukraine and its impact on our production, sales, supply chain, cost of energy, and availability of energy due to potential natural gas supply issues into Europe from the Nord Stream 1 pipeline; ii.risks associated with the impact of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COVID-19 Pandemic On March 11, 2020, the World Health Organization declared the COVID-19 outbreak a pandemic, asincluding global and regional economic conditions, changes in demand for our products, interruptions in our global supply chain, ability to continue production by our facilities, credit conditions of our customers or suppliers, or potential legal actions that could arise due to our operations during the virus spread throughoutpandemic;
- 26 -
GLATFELTER
Form 10-Q
Acquisition As discussed in Item 1 - Financial Statements, Note 3 “Acquisition,” on May 13, 2021, we completed our acquisition of Georgia-Pacific's U.S. nonwovens business (“Mount Holly”) for $170.7 million, subject to customary post-closing adjustments. This business includes the Mount Holly NC manufacturing facility, with annual production capacity of approximately 37,000 metric tons, and an R&D center and pilot line for nonwovens product development in Memphis, TN. Mount Holly’s net sales in 2020 were approximately $100 million. Prospectively from the date of acquisition, Mount Holly’s results of operation are included as part of our Airlaid Materials reporting segment.Jacob Holm
RESULTS OF OPERATIONS
.
|
|
•Composite Fibers with sales of single-serve tea and coffee filtration papers, wallcovering base materials, composite laminate papers, technical specialties including substrates for electrical applications, and metallized products; |
|
2021
| Six months ended June 30 |
| Six months ended June 30, | ||||||||||||||||
In thousands, except per share | 2021 |
|
| 2020 |
| In thousands, except per share | 2022 | 2021 | |||||||||||
Net sales | $ | 470,585 |
|
| $ | 447,743 |
| Net sales | $ | 745,643 | $ | 470,585 | |||||||
Gross profit |
| 74,850 |
|
|
| 68,865 |
| Gross profit | 69,062 | 74,850 | |||||||||
Operating income |
| 25,442 |
|
|
| 21,390 |
| ||||||||||||
Operating income (loss) | Operating income (loss) | (106,965) | 25,442 | ||||||||||||||||
Continuing operations |
|
|
|
|
|
|
| Continuing operations | |||||||||||
Income |
| 9,886 |
|
|
| 5,125 |
| ||||||||||||
Income (loss) | Income (loss) | (110,750) | 9,886 | ||||||||||||||||
Earnings per share |
| 0.22 |
|
|
| 0.12 |
| Earnings per share | (2.47) | 0.22 | |||||||||
Net income |
| 9,804 |
|
|
| 4,990 |
| ||||||||||||
Net income (loss) | Net income (loss) | (110,379) | 9,804 | ||||||||||||||||
Earnings per share | $ | 0.22 |
|
| $ | 0.11 |
| Earnings per share | (2.46) | 0.22 |
acquisition financing.
- 27 -
GLATFELTER
Form 10-Q
Cost optimization actions.These adjustments reflect charges incurred in connection with initiatives to optimize the cost structure of the Company, including costs related to the organizational change to a functional operating model. The costs are primarily related to executive separations,improve efficiencies or other objectives. Such actions may include asset rationalization, headcount reductions professional fees, asset write-offs and certain contract termination costs.or similar actions. These adjustments, which have occurred at various times in the past, are irregular in timing and relate to specific identified programs to reduce or optimize the cost structure of a particular operating segment or the corporate function.
Pension settlement expenses, net.
|
| Six months ended June 30 |
|
| |||||||||||||
|
| 2021 |
|
| 2020 |
|
| ||||||||||
In thousands, except per share |
| Amount |
|
| EPS |
|
| Amount |
|
| EPS |
|
| ||||
Net income |
| $ | 9,804 |
|
| $ | 0.22 |
|
| $ | 4,990 |
|
| $ | 0.11 |
|
|
Exclude: Loss from discontinued operations |
|
| 82 |
|
|
| — |
|
|
| 135 |
|
|
| 0.01 |
|
|
Income from continuing operations |
|
| 9,886 |
|
|
| 0.22 |
|
|
| 5,125 |
|
|
| 0.12 |
|
|
Adjustments (pre-tax) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic initiatives |
|
| 8,434 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
Corporate headquarters relocation |
|
| 361 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
Restructuring charge - Metallized operations |
|
| — |
|
|
|
|
|
|
| 11,054 |
|
|
|
|
|
|
Cost optimization actions |
|
| — |
|
|
|
|
|
|
| 3,097 |
|
|
|
|
|
|
Pension settlement expenses, net |
|
| — |
|
|
|
|
|
|
| 6,403 |
|
|
|
|
|
|
COVID 19 - incremental costs |
|
| — |
|
|
|
|
|
|
| 1,180 |
|
|
|
|
|
|
Asset impairment charge |
|
| — |
|
|
|
|
|
|
| 900 |
|
|
|
|
|
|
Timberland sales and related costs |
|
| (2,403 | ) |
|
|
|
|
|
| (601 | ) |
|
|
|
|
|
Total adjustments (pre-tax) |
|
| 6,392 |
|
|
|
|
|
|
| 22,033 |
|
|
|
|
|
|
Income taxes (1) |
|
| 31 |
|
|
|
|
|
|
| (3,882 | ) |
|
|
|
|
|
CARES Act of 2020 tax provision (benefit) (2) |
|
| 183 |
|
|
|
|
|
|
| (2,569 | ) |
|
|
|
|
|
Total after-tax adjustments |
|
| 6,606 |
|
|
| 0.15 |
|
|
| 15,582 |
|
|
| 0.34 |
|
|
Adjusted earnings |
| $ | 16,492 |
|
| $ | 0.37 |
|
| $ | 20,707 |
|
| $ | 0.46 |
|
|
Six months ended June 30, | |||||||||||||||||||||||
2022 | 2021 | ||||||||||||||||||||||
In thousands, except per share | Amount | EPS | Amount | EPS | |||||||||||||||||||
Net income (loss) | $ | (110,379) | $ | (2.46) | $ | 9,804 | $ | 0.22 | |||||||||||||||
Exclude: Loss (income) from discontinued operations, net of tax | (371) | (0.01) | 82 | — | |||||||||||||||||||
Income (loss) from continuing operations | (110,750) | (2.47) | 9,886 | 0.22 | |||||||||||||||||||
Adjustments (pre-tax): | |||||||||||||||||||||||
Goodwill and other asset impairment charges (1) | 117,349 | — | |||||||||||||||||||||
Russia/Ukraine conflict charges (2) | 3,948 | — | |||||||||||||||||||||
Strategic initiatives (3) | 2,488 | 8,434 | |||||||||||||||||||||
Corporate headquarters relocation | 223 | 361 | |||||||||||||||||||||
Cost optimization actions (4) | 941 | — | |||||||||||||||||||||
Timberland sales and related costs | (2,962) | (2,403) | |||||||||||||||||||||
Total adjustments (pre-tax) | 121,987 | 6,392 | |||||||||||||||||||||
Income taxes (5) | (19,167) | 31 | |||||||||||||||||||||
CARES Act of 2020 tax provision (6) | 175 | 183 | |||||||||||||||||||||
Total after-tax adjustments | 102,995 | 2.30 | 6,606 | 0.15 | |||||||||||||||||||
Adjusted earnings (loss) from continuing operations | $ | (7,755) | $ | (0.17) | $ | 16,492 | $ | 0.37 |
Six months ended June 30, | |||||||||||||||||||||||
Dollars in thousands | 2022 | 2021 | |||||||||||||||||||||
Net Sales | |||||||||||||||||||||||
Composite Fibers | $ | 259,167 | $ | 282,847 | |||||||||||||||||||
Airlaid Material | 293,172 | 187,738 | |||||||||||||||||||||
Spunlace | 193,304 | — | |||||||||||||||||||||
Total | $ | 745,643 | $ | 470,585 | |||||||||||||||||||
Operating income (loss) | |||||||||||||||||||||||
Composite Fibers | $ | 5,444 | $ | 27,128 | |||||||||||||||||||
Airlaid Material | 24,165 | 15,628 | |||||||||||||||||||||
Spunlace | (3,380) | — | |||||||||||||||||||||
Other and unallocated | (133,194) | (17,314) | |||||||||||||||||||||
Total | $ | (106,965) | $ | 25,442 | |||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||
Composite Fibers | $ | 11,315 | $ | 13,981 | |||||||||||||||||||
Airlaid Material | 15,171 | 12,615 | |||||||||||||||||||||
Spunlace | 5,859 | — | |||||||||||||||||||||
Other and unallocated | 2,591 | 1,870 | |||||||||||||||||||||
Total | $ | 34,936 | $ | 28,466 | |||||||||||||||||||
Capital expenditures | |||||||||||||||||||||||
Composite Fibers | $ | 10,258 | $ | 5,655 | |||||||||||||||||||
Airlaid Material | 5,532 | 3,036 | |||||||||||||||||||||
Spunlace | 3,886 | — | |||||||||||||||||||||
Other and unallocated | 3,021 | 2,520 | |||||||||||||||||||||
Total | $ | 22,697 | $ | 11,211 | |||||||||||||||||||
Tons shipped (metric) | |||||||||||||||||||||||
Composite Fibers | 52,457 | 68,611 | |||||||||||||||||||||
Airlaid Material | 83,733 | 63,179 | |||||||||||||||||||||
Spunlace | 40,094 | — | |||||||||||||||||||||
Total | 176,284 | $ | 131,790 |
Six months ended June 30, | |||||||||||||||||
In thousands | 2022 | 2021 | Change | ||||||||||||||
Net sales | $ | 745,643 | $ | 470,585 | $ | 275,058 | |||||||||||
Costs of products sold | 676,581 | 395,735 | 280,846 | ||||||||||||||
Gross profit | $ | 69,062 | $ | 74,850 | $ | (5,788) | |||||||||||
Gross profit as a percent of Net sales | 9.3 | % | 15.9 | % |
Six months ended June 30, | |||||||||||
Percent of Total | 2022 | 2021 | |||||||||
Segment | |||||||||||
Composite Fibers | 34.8 | % | 60.1 | % | |||||||
Airlaid Materials | 39.3 | 39.9 | |||||||||
Spunlace | 25.9 | — | |||||||||
Total | 100.0 | % | 100.0 | % |
|
|
|
|
- 28 -
GLATFELTER
Form 10-Q
In thousands | Six months ended June 30, | ||||
Favorable (unfavorable) | |||||
Net sales | $ | (32,135) | |||
Costs of products sold | 31,774 | ||||
SG&A expenses | 2,010 | ||||
Income taxes and other | 241 | ||||
Net loss | $ | 1,890 |
Three months ended June 30, | |||||||||||
In thousands, except per share | 2022 | 2021 | |||||||||
Net sales | $ | 363,963 | $ | 244,911 | |||||||
Gross profit | 37,397 | 35,554 | |||||||||
Operating income | 8,924 | 8,123 | |||||||||
Continuing operations: | |||||||||||
Income (loss) | (2,460) | 1,492 | |||||||||
Earnings per share | (0.05) | 0.03 | |||||||||
Net income (loss) | (2,052) | 1,410 | |||||||||
Earnings per share | (0.05) | 0.03 |
Three months ended June 30, | |||||||||||||||||||||||
2022 | 2021 | ||||||||||||||||||||||
In thousands, except per share | Amount | EPS | Amount | EPS | |||||||||||||||||||
Net income (loss) | $ | (2,052) | $ | (0.04) | $ | 1,410 | $ | 0.03 | |||||||||||||||
Exclude: Income from discontinued operations, net of tax | (408) | (0.01) | 82 | — | |||||||||||||||||||
Income (loss) from continuing operations | (2,460) | (0.05) | 1,492 | 0.03 | |||||||||||||||||||
Adjustments (pre-tax): | |||||||||||||||||||||||
Strategic initiatives (1) | 653 | 7,831 | |||||||||||||||||||||
Corporate headquarters relocation | 135 | 206 | |||||||||||||||||||||
Timberland sales and related costs | — | (1,553) | |||||||||||||||||||||
Total adjustments (pre-tax) | 788 | 6,484 | |||||||||||||||||||||
Income taxes (2) | (20) | (50) | |||||||||||||||||||||
CARES Act of 2020 tax provision (3) | 96 | 90 | |||||||||||||||||||||
Total after-tax adjustments | 864 | 0.01 | 6,524 | 0.15 | |||||||||||||||||||
Adjusted earnings (loss) from continuing operations | $ | (1,596) | $ | (0.04) | $ | 8,016 | $ | 0.18 |
Six months ended June 30 |
|
|
|
|
|
| Other and |
|
|
|
| ||||||||||||||||||||
Dollars in thousands | Composite Fibers |
|
| Airlaid Materials |
|
| Unallocated |
|
| Total |
| ||||||||||||||||||||
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||||||
Net sales | $ | 282,847 |
|
| $ | 254,848 |
|
| $ | 187,738 |
|
| $ | 192,895 |
|
| $ | — |
|
| $ | — |
|
| $ | 470,585 |
|
| $ | 447,743 |
|
Cost of products sold |
| 233,601 |
|
|
| 207,372 |
|
|
| 162,723 |
|
|
| 159,827 |
|
|
| (589 | ) |
|
| 11,679 |
|
|
| 395,735 |
|
|
| 378,878 |
|
Gross profit (loss) |
| 49,246 |
|
|
| 47,476 |
|
|
| 25,015 |
|
|
| 33,068 |
|
|
| 589 |
|
|
| (11,679 | ) |
|
| 74,850 |
|
|
| 68,865 |
|
SG&A |
| 22,118 |
|
|
| 20,887 |
|
|
| 9,387 |
|
|
| 8,754 |
|
|
| 20,306 |
|
|
| 18,431 |
|
|
| 51,811 |
|
|
| 48,072 |
|
Gains on dispositions of plant, equipment and timberlands, net |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2,403 | ) |
|
| (597 | ) |
|
| (2,403 | ) |
|
| (597 | ) |
Total operating income (loss) |
| 27,128 |
|
|
| 26,589 |
|
|
| 15,628 |
|
|
| 24,314 |
|
|
| (17,314 | ) |
|
| (29,513 | ) |
|
| 25,442 |
|
|
| 21,390 |
|
Non-operating expense |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (4,345 | ) |
|
| (11,104 | ) |
|
| (4,345 | ) |
|
| (11,104 | ) |
Income (loss) before income taxes | $ | 27,128 |
|
| $ | 26,589 |
|
| $ | 15,628 |
|
| $ | 24,314 |
|
| $ | (21,659 | ) |
| $ | (40,617 | ) |
| $ | 21,097 |
|
| $ | 10,286 |
|
Supplementary Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net tons sold |
| 68,611 |
|
|
| 65,015 |
|
|
| 63,179 |
|
|
| 68,316 |
|
|
| — |
|
|
| — |
|
|
| 131,790 |
|
|
| 133,331 |
|
Depreciation, depletion and amortization ($ in thousands) (1) | $ | 13,981 |
|
| $ | 12,897 |
|
| $ | 12,615 |
|
| $ | 10,924 |
|
| $ | 1,870 |
|
| $ | 5,787 |
|
| $ | 28,466 |
|
| $ | 29,608 |
|
Capital expenditures |
| 5,655 |
|
|
| 6,061 |
|
|
| 3,036 |
|
|
| 3,815 |
|
|
| 2,520 |
|
|
| 2,135 |
|
|
| 11,211 |
|
|
| 12,011 |
|
|
|
Segments Results of individual operating segments are presented based on our management accounting practices and management structure. There is no comprehensive, authoritative body of guidance for management accounting equivalent to accounting principles generally accepted in the United States of America; therefore, the financial results of individual segments are not necessarily comparable with similar information for any other company. The management accounting process uses assumptions and allocations to measure performance of the segments. Methodologies are refined from time to time as management accounting practices are enhanced and businesses change. The costs incurred by support areas not directly aligned with the segment are allocated primarily based on an estimated utilization of support area services or are included in “Other and Unallocated” in the table set forth above.
| Six months ended June 30 |
|
|
|
|
| Three months ended June 30, | ||||||||||||||||||||||
In thousands | 2021 |
|
| 2020 |
|
| Change |
| In thousands | 2022 | 2021 | Change | |||||||||||||||||
Net sales | $ | 470,585 |
|
| $ | 447,743 |
|
| $ | 22,842 |
| Net sales | $ | 363,963 | $ | 244,911 | $ | 119,052 | |||||||||||
Costs of products sold |
| 395,735 |
|
|
| 378,878 |
|
|
| 16,857 |
| Costs of products sold | 326,566 | 209,357 | 117,209 | ||||||||||||||
Gross profit | $ | 74,850 |
|
| $ | 68,865 |
|
| $ | 5,985 |
| Gross profit | $ | 37,397 | $ | 35,554 | $ | 1,843 | |||||||||||
Gross profit as a percent of Net sales |
| 15.9 | % |
|
| 15.4 | % |
|
|
|
| Gross profit as a percent of Net sales | 10.3 | % | 14.5 | % |
- 29 -
GLATFELTER
Form 10-Q
| Six months ended June 30 |
| Three months ended June 30, | ||||||||||||||||
Percent of Total | 2021 |
|
| 2020 |
| Percent of Total | 2022 | 2021 | |||||||||||
Segment |
|
|
|
|
|
|
| Segment | |||||||||||
Composite Fibers |
| 60.1 | % |
|
| 56.9 | % | Composite Fibers | 33.9 | % | 57.8 | % | |||||||
Airlaid Materials |
| 39.9 |
|
|
|
| 43.1 |
| Airlaid Materials | 39.5 | 42.2 | ||||||||
Spunlace | Spunlace | 26.6 | — | ||||||||||||||||
Total |
| 100.0 | % |
|
|
| 100.0 | % | Total | 100.0 | % | 100.0 | % |
Composite Fibers’ net sales increased $28.0 million or 11% in the first six months of 2021 compared to the year-ago period, driven by favorable currency translation of $21.1 million, as well as improved year-over-year shipments the largest of which is in the wallcover product category. Overall shipments increased 5.5% in the period-over-period comparison, due to solid demand for most markets other than metallized products, which was restructured in the second quarter of 2020.
2022 and 2021, respectively. Net sales for Composite Fibers and Airlaid Materials (including Mount Holly) decreased by 4.4% and increased by 47.7%, respectively, on a constant currency basis. The Spunlace segment, formed in connection with the Jacob Holm acquisition, had net sales of approximately $96.9 million in the second quarter of 2022.
chart (presented in millions):
- 30 -
GLATFELTER
Form 10-Q
wipes, tabletop, and hygiene product categories. Currency translation was $8.9 million unfavorable.
Foreign Currency We own and operate facilities in Canada, Germany, France, the United Kingdom, Spain, and the Philippines. The functional currency of our Canadian operations is the U.S. dollar. However, in Germany, France and FranceSpain, it is the Euro, in the UK, it is the British Pound Sterling,pound sterling, and in the Philippines the functional currency is the Peso.peso. On an annual basis, our Euroeuro denominated revenuenet sales exceeds Euroeuro expenses by an estimated €150 million. For the first sixthree months of 2021,ended June 30, 2022, the average currency exchange rate was 1.201.07 dollar/euro compared with 1.101.19 in the same period of 2020.2021. With respect to the British Pound Sterling,pound sterling, Canadian Dollar,dollar, and Philippine Peso,peso, we have differing amounts of inflows and outflows of these currencies, although to a lesser degree than the Euro.euro. As a result, we are exposed to changes in currency exchange rates and such changes could be significant. The translation of the results from international operations into U.S. dollars is subject to changes in foreign currency exchange rates.
The table below summarizes the translation impact on reported results that changes in currency exchange rates had on our non-U.S. based operations from the conversion of these operation’s results for the first six months of 2021.
In thousands | Six months ended June 30, 2021 |
| ||||
| Favorable (unfavorable) |
| ||||
Net sales |
|
|
| $ | 29,814 |
|
Costs of products sold |
|
|
|
| (28,760 | ) |
SG&A expenses |
|
|
|
| (1,884 | ) |
Income taxes and other |
|
|
|
| (422 | ) |
Net loss |
|
|
| $ | (1,252 | ) |
- 31 -
GLATFELTER
Form 10-Q
The above table only presents the financial reporting impact of foreign currency translations assuming currency exchange rates in 2021 were the same as 2020. It does not present the impact of certain competitive advantages or disadvantages of operating or competing in multi-currency markets.
Three months ended June 30, 2021 versus the three months ended June 30, 2020
Overview For the second quarter of 2021, we reported income from continuing operations of $1.5 million, or $0.03 per diluted share compared with a net loss of $2.3 million, or $0.05 per share in the second quarter of 2020. On an adjusted basis earnings from continuing operations for the second quarter of 2021 was $8.0 million, or $0.18 per share compared with $9.9 million, or $0.22 per share, for the same period a year ago. The following table sets forth summarized results of operations:
| Three months ended June 30 |
| ||||||
In thousands, except per share | 2021 |
|
|
| 2020 |
| ||
Net sales | $ | 244,911 |
|
|
| $ | 216,183 |
|
Gross profit |
| 35,554 |
|
|
|
| 32,063 |
|
Operating income |
| 8,123 |
|
|
|
| 9,109 |
|
Continuing operations |
|
|
|
|
|
|
|
|
Income (loss) |
| 1,492 |
|
|
|
| (2,281 | ) |
Earnings (loss) per share |
| 0.03 |
|
|
|
| (0.05 | ) |
Net income (loss) |
| 1,410 |
|
|
|
| (2,416 | ) |
Earnings (loss) per share | $ | 0.03 |
|
|
| $ | (0.05 | ) |
The following table sets forth the reconciliation of net income (loss) to adjusted earnings for the three months ended June 30, 2021 and 2020:
|
| Three months ended June 30 |
|
| |||||||||||||
|
| 2021 |
|
| 2020 |
|
| ||||||||||
In thousands, except per share |
| Amount |
|
| EPS |
|
| Amount |
|
| EPS |
|
| ||||
Net income |
| $ | 1,410 |
|
| $ | 0.03 |
|
| $ | (2,416 | ) |
| $ | (0.05 | ) |
|
Exclude: Loss from discontinued operations |
|
| 82 |
|
|
| — |
|
|
| 135 |
|
|
| — |
|
|
Income (loss) from continuing operations |
|
| 1,492 |
|
|
| 0.03 |
|
|
| (2,281 | ) |
|
| (0.05 | ) |
|
Adjustments (pre-tax) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic initiatives |
|
| 7,831 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
Corporate headquarters relocation |
|
| 206 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
Restructuring charge - Metallized operations |
|
| — |
|
|
|
|
|
|
| 5,067 |
|
|
|
|
|
|
Cost optimization actions |
|
| — |
|
|
|
|
|
|
| 1,349 |
|
|
|
|
|
|
Pension settlement expenses, net |
|
| — |
|
|
|
|
|
|
| 6,330 |
|
|
|
|
|
|
COVID 19 - incremental costs |
|
| — |
|
|
|
|
|
|
| 1,180 |
|
|
|
|
|
|
Asset impairment charge |
|
| — |
|
|
|
|
|
|
| 900 |
|
|
|
|
|
|
Timberland sales and related costs |
|
| (1,553 | ) |
|
|
|
|
|
| (601 | ) |
|
|
|
|
|
Total adjustments (pre-tax) |
|
| 6,484 |
|
|
|
|
|
|
| 14,225 |
|
|
|
|
|
|
Income taxes (1) |
|
| (50 | ) |
|
|
|
|
|
| (2,047 | ) |
|
|
|
|
|
CARES Act of 2020 tax provision (2) |
|
| 90 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
Total after-tax adjustments |
|
| 6,524 |
|
|
| 0.15 |
|
|
| 12,178 |
|
|
| 0.27 |
|
|
Adjusted earnings |
| $ | 8,016 |
|
| $ | 0.18 |
|
| $ | 9,897 |
|
| $ | 0.22 |
|
|
|
|
|
|
- 32 -
GLATFELTER
Form 10-Q
Segment Financial Performance
Three months ended June 30 |
|
|
|
|
|
| Other and |
|
|
|
| ||||||||||||||||||||
Dollars in thousands | Composite Fibers |
|
| Airlaid Materials |
|
| Unallocated |
|
| Total |
| ||||||||||||||||||||
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||||||
Net sales | $ | 141,598 |
|
| $ | 122,137 |
|
| $ | 103,313 |
|
| $ | 94,046 |
|
| $ | — |
|
| $ | — |
|
| $ | 244,911 |
|
| $ | 216,183 |
|
Cost of products sold |
| 119,334 |
|
|
| 100,387 |
|
|
| 90,138 |
|
|
| 77,581 |
|
|
| (115 | ) |
|
| 6,152 |
|
|
| 209,357 |
|
|
| 184,120 |
|
Gross profit (loss) |
| 22,264 |
|
|
| 21,750 |
|
|
| 13,175 |
|
|
| 16,465 |
|
|
| 115 |
|
|
| (6,152 | ) |
|
| 35,554 |
|
|
| 32,063 |
|
SG&A |
| 11,201 |
|
|
| 10,263 |
|
|
| 4,744 |
|
|
| 4,173 |
|
|
| 13,039 |
|
|
| 9,115 |
|
|
| 28,984 |
|
|
| 23,551 |
|
Gains on dispositions of plant, equipment and timberlands, net |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1,553 | ) |
|
| (597 | ) |
|
| (1,553 | ) |
|
| (597 | ) |
Total operating income (loss) |
| 11,063 |
|
|
| 11,487 |
|
|
| 8,431 |
|
|
| 12,292 |
|
|
| (11,371 | ) |
|
| (14,670 | ) |
|
| 8,123 |
|
|
| 9,109 |
|
Non-operating expense |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2,610 | ) |
|
| (8,837 | ) |
|
| (2,610 | ) |
|
| (8,837 | ) |
Income (loss) before income taxes | $ | 11,063 |
|
| $ | 11,487 |
|
| $ | 8,431 |
|
| $ | 12,292 |
|
| $ | (13,981 | ) |
| $ | (23,507 | ) |
| $ | 5,513 |
|
| $ | 272 |
|
Supplementary Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net tons sold |
| 34,471 |
|
|
| 29,032 |
|
|
| 34,315 |
|
|
| 33,277 |
|
|
| — |
|
|
| — |
|
|
| 68,786 |
|
|
| 62,309 |
|
Depreciation, depletion and amortization ($ in thousands) (1) | $ | 7,000 |
|
| $ | 6,431 |
|
| $ | 6,767 |
|
| $ | 5,473 |
|
| $ | 966 |
|
| $ | 2,302 |
|
| $ | 14,733 |
|
| $ | 14,206 |
|
Capital expenditures |
| 2,882 |
|
|
| 2,105 |
|
|
| 1,297 |
|
|
| 1,712 |
|
|
| 1,653 |
|
|
| 1,180 |
|
|
| 5,832 |
|
|
| 4,997 |
|
The sum of individual amounts set forth above may not agree to the condensed consolidated financial statements included herein due to rounding
Sales and Costs of Products Sold
| Three months ended June 30 |
|
|
|
|
|
|
| ||||||
In thousands | 2021 |
|
|
| 2020 |
|
|
| Change |
|
| |||
Net sales | $ | 244,911 |
|
|
| $ | 216,183 |
|
|
| $ | 28,728 |
|
|
Costs of products sold |
| 209,357 |
|
|
|
| 184,120 |
|
|
|
| 25,237 |
|
|
Gross profit | $ | 35,554 |
|
|
| $ | 32,063 |
|
|
| $ | 3,491 |
|
|
Gross profit as a percent of Net sales |
| 14.5 | % |
|
|
| 14.8 | % |
|
|
|
|
|
|
The following table sets forth the contribution to consolidated net sales by each segment:
| Three months ended June 30 |
| ||||||
Percent of Total | 2021 |
|
|
| 2020 |
| ||
Segment |
|
|
|
|
|
|
|
|
Composite Fibers |
| 57.8 | % |
|
|
| 56.5 | % |
Airlaid Materials |
| 42.2 |
|
|
|
| 43.5 |
|
Total |
| 100.0 | % |
|
|
| 100.0 | % |
Net sales totaled $244.9 million and $216.2 million in the second quarters of 2021 and 2020, respectively. On a constant currency basis, Composite Fibers’ net sales increased by 7.1% and Airlaid Materials’ increased by 5.0%.
Composite Fibers’ net sales increased $19.5 million or 15.9% in the second quarter of 2021, compared to the year-ago quarter, mainly driven by a 95% increase in our wallcover sales from the trough of the pandemic in 2020 and favorable currency translation of $10.7 million. Overall shipments, excluding metallized, which was restructured in the second quarter of 2020, were up 26% versus the second quarter of 2020.
Composite Fibers’ operating income of $11.1 million was $0.4 million lower, compared to the second quarter of 2020. Raw material and energy prices were $6.0 million higher than the same period last year and partly offset by approximately $2.0 million of price increases. In addition, the higher sales volume for wallcover, electrical, and coffee products, combined with increased production to meet customer demand, fully offset input price inflation. The impact of currency and related hedging activity negatively impacted earnings by $0.6 million. The primary drivers are summarized in the following chart:
- 33 -
GLATFELTER
Form 10-Q
Airlaid Materials’ net sales increased $9.3 million in the year-over-year comparison, including six weeks of sales from the recent Mount Holly acquisition. Shipments were 3.1% higher driven by Mount Holly, as well as a significant increase in tabletop demand as in-person dining began to recover globally. These increases were partially offset by lower shipments in the hygiene and wipes categories related to customer destocking from elevated inventory levels maintained during the pandemic. Currency translation was $4.6 million favorable.
Airlaid Materials’ second quarter 2021 operating income of $8.4 million was $3.9 million lower when compared to the second quarter of 2020. Higher shipments were more than offset by unfavorable mix negatively impacting earnings by $0.9 million while operations were $1.9 million unfavorable driven by lower production to adjust to customer demand and manage inventory levels. Selling price increases due to raw material pass-through provisions were more than offset by higher raw material and energy prices, reducing earnings by net $0.8 million. The impact of currency and related hedging activity negatively impacted earnings by $0.3 million. The primary drivers are summarized in the following chart:
Other and Unallocated The amount of “Other and Unallocated” operating expense in our table of Segment Financial Performance totaled $11.4 million in the second quarter of 2021 compared with $14.7 million in the second quarter of 2020. Excluding the items identified to present “adjusted earnings,” unallocated expenses for the second quarter of 2021 decreased $1.9 million compared to the second quarter of 2020.
Income Taxes In the second quarter of 2021, income from continuing operations totaled $5.5 million and income tax expense totaled $4.0 million. On adjusted pre-tax income of $12.0 million, income tax expense was $4.0 million in the second quarter of 2021.
- 34 -
GLATFELTER
Form 10-Q
The comparable amounts in the same quarter of 2020 were $14.5 million and $4.6 million, respectively. The effective tax rate on adjusted earnings was 33% in the second quarter of 2021.
Foreign Currency For the three months ended June 30, 2021, the average currency exchange rate was 1.21 dollar/euro compared with 1.10 in the same period of 2020. The table below summarizes the translation impact on reported results that changes in currency exchange rates had on our non-U.S. based operations from the conversion of these operation’s results for the second quarter of 2021.
In thousands | Three months ended June 30, 2021 |
|
| ||||
| Favorable (unfavorable) |
|
| ||||
Net sales |
|
|
| $ | 15,287 |
|
|
Costs of products sold |
|
|
|
| (15,173 | ) |
|
SG&A expenses |
|
|
|
| (1,021 | ) |
|
Income taxes and other |
|
|
|
| (221 | ) |
|
Net loss |
|
|
| $ | (1,128 | ) |
|
In thousands | Three months ended June 30, 2022 | ||||
Favorable (unfavorable) | |||||
Net sales | $ | (20,875) | |||
Costs of products sold | 21,553 | ||||
SG&A expenses | 1,384 | ||||
Income taxes and other | 190 | ||||
Net loss | $ | 2,252 |
| Six months ended June 30 |
|
| ||||||
In thousands | 2021 |
|
|
| 2020 |
|
| ||
Cash, cash equivalents and restricted cash at the beginning of period | $ | 111,665 |
|
|
| $ | 126,201 |
|
|
Cash provided (used) by |
|
|
|
|
|
|
|
|
|
Operating activities |
| 1,365 |
|
|
|
| (912 | ) |
|
Investing activities |
| (181,136 | ) |
|
|
| (11,448 | ) |
|
Financing activities |
| 165,138 |
|
|
|
| (23,175 | ) |
|
Effect of exchange rate changes on cash |
| (1,432 | ) |
|
|
| (123 | ) |
|
Change in cash and cash equivalents from discontinued operations |
| (238 | ) |
|
|
| (945 | ) |
|
Net cash used |
| (16,303 | ) |
|
|
| (36,603 | ) |
|
Cash, cash equivalents and restricted cash at the end of period |
| 95,362 |
|
|
|
| 89,598 |
|
|
Less: restricted cash in Prepaid and other current assets |
| (2,000 | ) |
|
|
| (2,000 | ) |
|
Less: restricted cash in Other assets |
| (9,197 | ) |
|
|
| (10,979 | ) |
|
Cash and cash equivalents at the end of period | $ | 84,165 |
|
|
| $ | 76,619 |
|
|
Six months ended June 30, | |||||||||||
In thousands | 2022 | 2021 | |||||||||
Cash, cash equivalents and restricted cash at the beginning of period | $ | 148,814 | $ | 111,665 | |||||||
Cash provided (used) by | |||||||||||
Operating activities | (79,535) | 1,365 | |||||||||
Investing activities | (18,136) | (181,136) | |||||||||
Financing activities | 33,546 | 165,138 | |||||||||
Effect of exchange rate changes on cash | (3,587) | (1,432) | |||||||||
Change in cash and cash equivalents from discontinued operations | (231) | (238) | |||||||||
Net cash used | (67,943) | (16,303) | |||||||||
Cash, cash equivalents and restricted cash at the end of period | 80,871 | 95,362 | |||||||||
Less: restricted cash in Prepaid and other current assets | (2,000) | (2,000) | |||||||||
Less: restricted cash in Other assets | (7,395) | (9,197) | |||||||||
Cash and cash equivalents at the end of period | $ | 71,476 | $ | 84,165 |
Cash providedused by operating activities in the first six months of 20212022 totaled $1.4$79.5 million compared with a usecash provided by operating activities of $(0.9)$1.4 million in the same period a year ago. The change in operating cash flow reflects a $5.8 millionThe increase was primarily due to an increase in earnings before interest, taxes, depreciation and amortization, as well as by improved working capital usage, primarily accounts receivable, inventory and the termination of a factoring arrangement previously utilized by certain former Jacob Holm entities, an $11.5 million reduction in adjusted EBITDA, a $7.6 million increase in income taxes paid and a $13.0 million increase in interest paid.
Adjusted EBITDA | Six months ended June 30, | |||||||||||||
In thousands | 2022 | 2021 | ||||||||||||
Net income (loss) | $ | (110,379) | $ | 9,804 | ||||||||||
Exclude: Income (loss) from discontinued operations, net of tax | (371) | 82 | ||||||||||||
Add back: Taxes on Continuing operations | (13,489) | 11,211 | ||||||||||||
Depreciation and amortization | 34,936 | 28,466 | ||||||||||||
Interest expense, net | 15,479 | 3,272 | ||||||||||||
EBITDA | (73,824) | 52,835 | ||||||||||||
Adjustments: | ||||||||||||||
Goodwill and other asset impairment charges | 117,349 | — | ||||||||||||
Russia/Ukraine conflict charges | 3,948 | — | ||||||||||||
Strategic initiatives | 2,488 | 8,434 | ||||||||||||
Share-based compensation (1) | 2,419 | 2,537 | ||||||||||||
Corporate headquarters relocation | 223 | 361 | ||||||||||||
Cost optimization actions | 589 | — | ||||||||||||
Timberland sales and related costs | (2,962) | (2,403) | ||||||||||||
Adjusted EBITDA | $ | 50,230 | $ | 61,764 |
- 35 -
GLATFELTER
Form 10-Q
our ongoing operating performance.
2022.
The 2019 Facilityacquisition.
The following table sets forth our outstanding long-term indebtedness:
|
| June 30 |
|
|
| December 31 |
| ||
In thousands |
| 2021 |
|
|
| 2020 |
| ||
Revolving credit facility, due Feb. 2024 |
| $ | 213,478 |
|
|
| $ | 36,813 |
|
Term Loan, due Feb. 2024 |
|
| 235,303 |
|
|
|
| 249,715 |
|
2.40% Term Loan, due Jun. 2022 |
|
| 1,698 |
|
|
|
| 2,629 |
|
2.05% Term Loan, due Mar. 2023 |
|
| 11,100 |
|
|
|
| 14,737 |
|
1.30% Term Loan, due Jun. 2023 |
|
| 3,396 |
|
|
|
| 4,382 |
|
1.55% Term Loan, due Sep. 2025 |
|
| 6,189 |
|
|
|
| 7,143 |
|
Total long-term debt |
|
| 471,164 |
|
|
|
| 315,419 |
|
Less current portion |
|
| (24,267 | ) |
|
|
| (25,057 | ) |
Unamortized deferred issuance costs |
|
| (1,636 | ) |
|
|
| (1,898 | ) |
Long-term debt, net of current portion |
| $ | 445,261 |
|
|
| $ | 288,464 |
|
Financing activities include cash used for common stock dividends. In both the first six months of 20212022 and 2020,2021, we used $12.0$12.5 million and $11.5$12.0 million, respectively, of cash for dividends on our common stock. Our Board of Directors determines what, if any, dividends will be paid to our shareholders. In the second quarter of 2021, our quarterly dividend was increased by 3.7% to $0.14 per share. Dividend payment decisions are based upon then-existing factors and conditions and, therefore, historical trends of dividend payments are not necessarily indicative of future payments.
GLATFELTER
Form 10-Q
|
| Year Ended December 31 |
|
| June 30, 2021 |
|
| Year Ended December 31 | June 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands, except percentages |
| 2021 |
|
| 2022 |
|
| 2023 |
|
| 2024 |
|
| 2025 |
|
| Carrying Value |
|
| Fair Value |
|
| In thousands, except percentages | 2022 | 2023 | 2024 | 2025 | 2026 | Carrying Value | Fair Value | |||||||||||||||||||||||||||||||||||||||||
Long-term debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Long-term debt | ||||||||||||||||||||||||||||||||||||||||
Average principal outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Average principal outstanding | ||||||||||||||||||||||||||||||||||||||||
At variable interest rates |
| $ | 442,245 |
|
| $ | 432,441 |
|
| $ | 419,368 |
|
| $ | 62,681 |
|
| $ | — |
|
|
| $ | 448,781 |
|
| $ | 448,781 |
|
| At variable interest rates | $ | 272,541 | $ | 261,116 | $ | 255,403 | $ | 81,161 | $ | 54,700 | $ | 275,398 | $ | 275,398 | ||||||||||||||||||||||||||
At fixed interest rates – Term Loans |
|
| 25,927 |
|
|
| 16,994 |
|
|
| 8,289 |
|
|
| 2,137 |
|
|
| 437 |
|
|
|
| 22,383 |
|
|
| 22,589 |
|
| At fixed interest rates – Term Loans | 533,306 | 521,934 | 502,221 | 500,382 | 500,000 | 537,163 | 385,434 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| $ | 471,164 |
|
| $ | 471,370 |
|
| $ | 812,561 | $ | 660,832 | |||||||||||||||||||||||||||||||||||||
Weighted-average interest rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted-average interest rate | ||||||||||||||||||||||||||||||||||||||||
On variable rate debt |
|
| 1.32 | % |
|
| 1.32 | % |
|
| 1.32 | % |
|
| 1.32 | % |
|
| — |
|
|
|
|
|
|
|
|
|
|
| On variable rate debt | 2.44 | % | 2.44 | % | 2.44 | % | 2.44 | % | 2.44 | % | ||||||||||||||||||||||||||||||
On fixed rate debt – Term Loans |
|
| 1.87 | % |
|
| 1.84 | % |
|
| 1.83 | % |
|
| 1.62 | % |
|
| 1.55 | % |
|
|
|
|
|
|
|
|
|
| On fixed rate debt – Term Loans | 4.51 | % | 4.58 | % | 4.74 | % | 4.75 | % | 4.75 | % | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||
Interest rate swap |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||
Pay fixed/received variable (notional) |
| € | 180,000 |
|
| € | 180,000 |
|
| € | 180,000 |
|
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||
Rate paid |
|
| 0.0395 | % |
|
| 0.0395 | % |
|
| 0.0395 | % |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||
Rate received |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
|
|
|
We entered into a €180 million notional value floating-to-fixed interest rate swap agreement with certain financial institutions. Under the terms of the swap, we will pay a fixed interest rate of 0.0395% on €180 million of the underlying variable rate term loan. We will receive the greater of 0.00% or EURIBOR.
18.
GLATFELTER
Form 10-Q
| Incorporated by reference to | |||||||
31.1 | ||||||||
31.2 | ||||||||
| ||||||||
32.1 | ||||||||
| ||||||||
32.2 | ||||||||
| ||||||||
10.1 | Ex. 10.1 to Form 8-K filed May 10, 2022 | |||||||
| Ex. 99.1 to Form S-8 filed May 11, 2022 | |||||||
10.3 | ||||||||
10.4 | ||||||||
10.5 | ||||||||
10.6 | ||||||||
10.7 | ||||||||
101.INS | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data file because its iXBRL tags are embedded within the Inline XBRL document. | |||||||
101.SCH | ||||||||
| Inline XBRL Taxonomy Extension Schema. | |||||||
101.CAL | ||||||||
| Inline XBRL Extension Calculation Linkbase. | |||||||
101.DEF | ||||||||
| Inline XBRL Extension Definition Linkbase. | |||||||
101.LAB | ||||||||
| Inline XBRL Extension Label Linkbase. | |||||||
101.PRE | ||||||||
| Inline XBRL Extension Presentation Linkbase. | |||||||
104 | ||||||||
| Cover Page Interactive Data File (formatted as an inline XBRL and contained in Exhibit 101). |
GLATFELTER
Form 10-Q
| |||||||||||||
Glatfelter Corporation (Registrant) | |||||||||||||
| |||||||||||||
August 2, 2022 | |||||||||||||
| |||||||||||||
By | /s/ David C. Elder | ||||||||||||
David C. Elder | |||||||||||||
Vice President, Finance and Chief Accounting Officer (Principal Accounting Officer) |
GLATFELTER
Form 10-Q