EXHIBIT 99
PRESS RELEASE DATED April 29, 2008
BEMIS COMPANY, INC.
One Neenah Center, 4th Floor
P.O. Box 669
Neenah, Wisconsin 54957-0669
For additional information please contact:
Melanie E. R. Miller
Vice President, Investor Relations
and Treasurer
(920) 527-5045
FOR IMMEDIATE RELEASE
BEMIS COMPANY REPORTS 2008 FIRST QUARTER RESULTS
NEENAH, WISCONSIN, April 29, 2008 – Bemis Company, Inc. (NYSE-BMS) today reported quarterly diluted earnings of $0.42 per share for the first quarter ended March 31, 2008, compared to $0.45 per share for the same quarter of 2007. Net sales increased to $947.3 million for the first quarter of 2008, a 4.2 percent increase from $909.1 million for the same period of 2007. Currency benefits contributed 5.1 percent to net sales for the quarter.
“This quarter we experienced rising raw material costs, especially with regard to our specialty resin and chemical inputs,” said Henry Theisen, Bemis Company’s President and Chief Executive Officer. “In this environment, we continue to expand our product reach into new markets and geographies while maintaining a rigorous focus on cost management, waste reduction and production efficiency. I am pleased to see stability and modest volume growth returning to our largest flexible packaging end markets and look forward to modest overall volume growth for the total year 2008.”
BUSINESS SEGMENTS
Flexible Packaging
Flexible packaging, which represented about 83 percent of total Company net sales during the quarter, reported net sales of $781.6 million in the first quarter, a 5.2 percent increase compared to net sales of $743.2 million for the first quarter of 2007. Currency related sales growth totaled 4.8 percent. Segment operating profit for the first quarter of 2008 was $79.3 million, or 10.1 percent of net sales. Segment operating profit for the first quarter of 2007 was $88.2 million, or 11.9 percent of net sales. Currency benefits added $2.3 million to operating profit in the first quarter of 2008. Lower operating profit reflects the impact of generally higher input costs in 2008 compared to the previous year.
Commenting on the flexible packaging segment results, Theisen said, “During the first quarter, we experienced higher specialty resin costs which negatively impacted operating profit levels in our flexible packaging business segment. These and other inflationary cost pressures are being managed with selling price increases and profit improvement programs that we expect to result in improved performance for the remainder of the year. Flexible packaging unit sales volume increased modestly compared to last year and to last quarter, which primarily reflects the scale up of new business awarded in 2007 and stabilizing consumer demand in North America. We are encouraged by increased sales volume and mix improvements in our European flexible packaging business and are pleased with the start-up of our new medical device packaging plant in Northern Ireland. Our continuing focus on cost management and productivity improvement will be critical to ensure that the benefits of improving volume levels deliver profit momentum to the flexible packaging segment in 2008.”
Pressure Sensitive Materials
Net sales from the pressure sensitive materials business segment for the first quarter of 2008 were $165.7 million compared to $165.9 million in the first quarter of 2007. The benefits of currency were offset by lower unit sales. Segment operating profit for the first quarter of 2008 was $11.9 million, or 7.2 percent of net sales, compared to the first quarter of 2007 when segment operating profit was $14.3 million or 8.6 percent of net sales. Currency benefits added $1.2 million to operating profit in the first quarter of 2008.
“Growth in our pressure sensitive materials segment is impacted by conditions in certain end markets and regional economies,” said Theisen. “While our North American label product business is relatively stable, we are experiencing lower sales volumes in our higher margin technical product markets where customers with exposure to certain housing, industrial and medical markets are facing weak economic conditions. We continue to manage costs carefully through this difficult environment and look forward to the introduction of new products in 2008 which will further diversify our business and build momentum once the economy begins to recover.”
Other Costs (Income), Net
For the first quarter of 2008, other costs and income included $7.7 million of financial income compared to $5.1 million for the first quarter of 2007.
Capital Structure
Total debt to total capitalization was 33.4 percent at March 31, 2008, compared to 32.9 percent at December 31, 2007. Total debt as of March 31, 2008 was $875.8 million, an increase of $32.5 million from the balance of $843.3 million at December 31, 2007. Cash flow from operations was $55.6 million in the first quarter of 2008.
Dividend Increase and Share Repurchase
In the first quarter, the board of directors approved a 4.8 percent increase in the quarterly dividend. Bemis also repurchased one million shares of its common stock on the open market during the first quarter of 2008 for $26.8 million.
2008 Earnings Outlook
Management expects second quarter 2008 diluted earnings per share to be in a range of $0.44 to $0.47 per share. Guidance for the full year 2008 remains unchanged at $1.78 to $1.88 per share. Management continues to expect capital expenditures to be in the $125 million range for 2008. Commenting on the outlook for the year, Theisen noted that the market conditions remain difficult to predict. “At Bemis, we are improving our cost structure and strengthening our competitive position across all of our markets. We intend to react swiftly to the challenges of this dynamic, global economic environment and build positive performance momentum going forward.”
Forward Looking Statements
Statements in this release that are not historical, including statements relating to the expected future performance of the Company, are considered “forward-looking” and are presented pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Such content is subject to certain risks and uncertainties, including but not limited to future changes in cost or availability of raw materials, consumer buying patterns under certain economic conditions, changes in customer order patterns, the results of competitive bid processes, a failure in our information technology infrastructure or applications, foreign currency fluctuations and changes in prevailing market interest rates. Actual future results and trends may differ materially from historical results or those projected in any such forward-looking statements depending on a variety of factors which are detailed in the Company’s regular SEC filings including the most recently filed Form 10-K for the year ended December 31, 2007.
Bemis Company, Inc. will webcast an investor telephone conference regarding its first quarter 2008 financial results this morning at 10 a.m., Eastern Time. Individuals may listen to the call on the Internet at www.bemis.com under “Investor Relations”. Listeners are urged to check the website ahead of time to ensure their computers are configured for the audio stream. Instructions for obtaining the required, free, downloadable software are available in a pre-event system test on the site.
Bemis Company is a major supplier of flexible packaging and pressure sensitive materials used by leading food, consumer products, manufacturing, and other companies worldwide. Founded in 1858, the Company reported 2007 net sales of $3.6 billion. The Company’s flexible packaging business has a strong technical base in polymer chemistry, film extrusion, coating and laminating, printing and converting. The Company’s pressure sensitive materials business specializes in adhesive technologies. Headquartered in Neenah, Wisconsin, Bemis employs about 15,700 individuals in 56 manufacturing facilities in 10 countries around the world. More information about the Company is available at our website, www.bemis.com.
BEMIS COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(in thousands, except per share amounts)
(unaudited)
| | Three Months Ended
March 31, | |
| | 2008 | | 2007 | |
| | | | | |
Net sales | | $ | 947,282 | | $ | 909,130 | |
| | | | | |
Costs and expenses: | | | | | |
Cost of products sold | | 784,313 | | 731,979 | |
Selling, general and administrative expenses | | 88,744 | | 85,476 | |
Research and development | | 5,828 | | 6,225 | |
Interest expense | | 9,029 | | 12,490 | |
Other costs (income), net | | (9,105 | ) | (5,185 | ) |
Minority interest in net income | | 1,340 | | 589 | |
| | | | | |
Income before income taxes | | 67,133 | | 77,556 | |
| | | | | |
Provision for income taxes | | 24,800 | | 29,300 | |
| | | | | |
Net income | | $ | 42,333 | | $ | 48,256 | |
| | | | | |
Basic earnings per share of common stock | | $ | 0.42 | | $ | 0.46 | |
| | | | | |
Diluted earnings per share of common stock | | $ | 0.42 | | $ | 0.45 | |
| | | | | |
Cash dividends paid | | $ | 0.22 | | $ | 0.21 | |
| | | | | |
Weighted average common shares outstanding | | 100,117 | | 105,053 | |
Weighted average common shares and common stock equivalents outstanding | | 100,919 | | 106,535 | |
BEMIS COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(dollars in thousands)
(unaudited)
| | March 31
2008 | | December 31
2007 | |
ASSETS | | | | | |
| | | | | |
Cash and cash equivalents | | $ | 157,196 | | $ | 147,409 | |
Accounts receivable, net | | 484,161 | | 448,200 | |
Inventories, net | | 498,198 | | 478,727 | |
Prepaid expenses | | 68,734 | | 62,607 | |
Total current assets | | 1,208,289 | | 1,136,943 | |
| | | | | |
Property and equipment, net | | 1,248,678 | | 1,248,456 | |
| | | | | |
Goodwill | | 647,321 | | 642,507 | |
Other intangible assets, net | | 102,488 | | 103,756 | |
Deferred charges and other assets | | 59,047 | | 59,734 | |
Total | | 808,856 | | 805,997 | |
| | | | | |
TOTAL ASSETS | | $ | 3,265,823 | | $ | 3,191,396 | |
| | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | |
| | | | | |
Current portion of long-term debt | | $ | 7,330 | | $ | 1,758 | |
Short-term borrowings | | 52,689 | | 66,047 | |
Accounts payable | | 377,407 | | 384,673 | |
Accrued salaries and wages | | 66,418 | | 70,248 | |
Accrued income and other taxes | | 32,179 | | 11,824 | |
Total current liabilities | | 536,023 | | 534,550 | |
| | | | | |
Long-term debt, less current portion | | 815,776 | | 775,456 | |
Deferred taxes | | 156,684 | | 155,871 | |
Deferred credits and other liabilities | | 128,907 | | 124,261 | |
Total liabilities | | 1,637,390 | | 1,590,138 | |
| | | | | |
Minority interest | | 40,779 | | 38,926 | |
| | | | | |
Stockholders’ equity: | | | | | |
Common stock issued (117,051,314 and 116,941,126 shares) | | 11,705 | | 11,694 | |
Capital in excess of par value | | 331,316 | | 327,387 | |
Retained income | | 1,543,278 | | 1,523,659 | |
Other comprehensive income (loss) | | 199,696 | | 171,162 | |
Treasury common stock (17,422,771 and 16,422,771 shares) | | (498,341 | ) | (471,570 | ) |
Total stockholders’ equity | | 1,587,654 | | 1,562,332 | |
| | | | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | | $ | 3,265,823 | | $ | 3,191,396 | |
BEMIS COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
(unaudited)
| | Three Months Ended
March 31, | |
| | 2008 | | 2007 | |
Cash flows from operating activities | | | | | |
Net income | | $ | 42,333 | | $ | 48,256 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | |
Depreciation and amortization | | 41,838 | | 39,677 | |
Minority interest in net income | | 1,340 | | 589 | |
Excess tax benefit from share-based payment arrangements | | (56 | ) | (5,612 | ) |
Stock award compensation | | 4,677 | | 3,831 | |
Deferred income taxes | | (346 | ) | 1,343 | |
Income of unconsolidated affiliated company | | (509 | ) | (263 | ) |
Loss (gain) on sales of property and equipment | | 777 | | (772 | ) |
Non-cash restructuring related activities | | | | (519 | ) |
Changes in working capital, net of effects of acquisitions | | (41,559 | ) | (36,787 | ) |
Net change in deferred charges and credits | | 7,098 | | 23,366 | |
| | | | | |
Net cash provided by operating activities | | 55,593 | | 73,109 | |
| | | | | |
Cash flows from investing activities | | | | | |
Additions to property and equipment | | (28,393 | ) | (47,298 | ) |
Business acquisitions and adjustments, net of cash acquired | | | | (97 | ) |
Proceeds from sales of property and equipment | | 290 | | 7,339 | |
| | | | | |
Net cash used in investing activities | | (28,103 | ) | (40,056 | ) |
| | | | | |
Cash flows from financing activities | | | | | |
Repayment of long-term debt | | (8,898 | ) | (1,975 | ) |
Net borrowing of commercial paper | | 47,750 | | 54,550 | |
Net (repayment) borrowing of short-term debt | | (9,367 | ) | 10,142 | |
Cash dividends paid to stockholders | | (22,714 | ) | (22,729 | ) |
Common stock purchased for the treasury | | (26,771 | ) | (34,150 | ) |
Excess tax benefit from share-based payment arrangements | | 56 | | 5,612 | |
Stock incentive programs and related withholdings | | (1,364 | ) | (13,567 | ) |
| | | | | |
Net cash provided (used) by financing activities | | (21,308 | ) | (2,117 | ) |
| | | | | |
Effect of exchange rates on cash and cash equivalents | | 3,605 | | (248 | ) |
| | | | | |
Net (decrease) increase in cash and cash equivalents | | 9,787 | | 30,688 | |
| | | | | |
Cash and cash equivalents balance at beginning of year | | 147,409 | | 112,160 | |
| | | | | |
Cash and cash equivalents balance at end of period | | $ | 157,196 | | $ | 142,848 | |
BEMIS COMPANY, INC. AND SUBSIDIARIES
OPERATING PROFIT AND PRETAX PROFIT
(in millions)
(unaudited)
| | Three Months Ended
March 31, | |
| | 2008 | | 2007 | |
| | | | | |
Flexible Packaging operating profit | | $ | 79.3 | | $ | 88.2 | |
| | | | | |
Pressure Sensitive Materials operating profit | | 11.9 | | 14.3 | |
| | | | | |
General Corporate Expenses | | (13.8 | ) | (11.8 | ) |
| | | | | |
Interest Expense | | (9.0 | ) | (12.5 | ) |
| | | | | |
Minority Interest in Net Income | | (1.3 | ) | (0.6 | ) |
| | | | | |
Income before Income Taxes | | $ | 67.1 | | $ | 77.6 | |
