Exhibit 99.1
For More Information Contact: | ||
Stephen J. Hagge | FOR IMMEDIATE RELEASE | |
AptarGroup, Inc. | ||
815-477-0424 |
APTARGROUP REPORTS RECORD FIRST QUARTER RESULTS;
DECLARES DIVIDEND
Crystal Lake, Illinois, April 16, 2003 — AptarGroup, Inc. (NYSE:ATR) today reported record first quarter results.
FIRST QUARTER RESULTS
For the quarter ended March 31, 2003, sales increased 21 percent to $265.1 million from $218.7 million in the prior year. Sales excluding changes in foreign currency exchange rates increased approximately 9 percent from the prior year. Net income for the first quarter of 2003 increased to a record $19.2 million from $13.3 million a year ago. Diluted earnings per share were $.53 per share compared to $.36 per share in the prior year.
In the first quarter of the prior year, the Company recorded after-tax charges totaling $2.8 million related to a patent dispute settlement and the Strategic Initiative. Excluding these charges, net income for the first quarter of 2002 was $16.1 million and diluted earnings per share were $.44 per share.
MANAGEMENT COMMENT
Commenting on the quarter, Carl A. Siebel, President and Chief Executive Officer, said, “We are pleased to report record first quarter results that were in line with our earlier expectations. Sales to all of the markets we serve increased over the prior year despite ongoing price competition. The increase in sales reflects strong organic growth, particularly in the food/beverage, personal care and fragrance/cosmetic markets, and foreign currency translation effects.
“While our operating income increased compared to the prior year excluding nonrecurring charges, as a percentage of sales it decreased slightly. The positive effect of the weaker dollar from the translation of foreign results was mitigated by increased costs of imports to the U.S. Also, we experienced higher than expected start-up costs related to an unusually large number of new product introductions in the food/beverage market.
“However, increased sales resulted in improved overhead utilization and we continue to benefit from our cost reduction efforts. These factors, combined with lower interest expense, helped drive diluted earnings per share to a record first quarter level.” Siebel added.
BUSINESS SEGMENT PERFORMANCE
For the quarter, sales of the Dispensing Systems segment increased 22 percent, to $219.2 million from $180.0 million in the prior year. The increase is mainly due to increased sales to the food/beverage, personal care and fragrance/cosmetic markets. First quarter EBIT (earnings before interest and taxes) for the Dispensing Systems segment increased to $29.9 million from $26.1 million in the prior year.
For the quarter, sales of the SeaquistPerfect segment increased 15 percent, to $47.9 million from $41.6 million in the prior year. The increase is primarily due to increased demand from the personal care market. First quarter EBIT for the SeaquistPerfect segment increased to $4.6 million from $3.2 million a year ago on a comparable basis primarily due to increased sales and continued cost savings.
See the appended supplemental segment information schedule for a reconciliation of the above amounts to the Company’s financial statements.
OUTLOOK
Siebel commented, “Looking forward to 2003, we are uncertain as to how our customers and end consumers will act in light of the ongoing situation in the Middle East and the general economic environment. Also, due to a reduction in international travel, it is particularly difficult to predict how demand for our fragrance/cosmetic customers’ products and our sales to this market will be affected. Despite these events, we remain cautiously optimistic about the year.
“As we enter the second quarter, the positive momentum in the food/beverage and personal care markets is expected to continue. Early indications point to increases in sales to the fragrance/cosmetic market compared to the same period a year ago. We anticipate that sales of our products to the pharmaceutical market will improve as the year progresses.”
Siebel concluded, “Presently, we anticipate diluted earnings per share for the second quarter of 2003 to be in the range of $.52 to $.57 per share compared to $.48 per share reported in 2002 (or $.50 per share excluding charges related to the Strategic Initiative).”
CASH DIVIDEND
Yesterday, the Board of Directors declared a quarterly dividend of $.06 per share, payable May 22, 2003 to shareholders of record as of May 1, 2003.
OPEN CONFERENCE CALL
There will be a conference call on Thursday, April 17, 2003 at 8:00 a.m. CST to discuss the Company’s first quarter results. The call will last approximately one hour and feature remarks by Carl A. Siebel and Stephen J. Hagge, AptarGroup’s Chief Financial Officer. Interested parties are invited to listen to a live webcast by visiting the Investor Relations page atwww.aptargroup.com. Replay of the conference call can also be accessed on the Investor Relations page of the web site until 5:00 p.m. CST on May 15, 2003.
AptarGroup, Inc. is a leading global supplier of a broad range of innovative dispensing systems for the personal care, fragrance/cosmetic, pharmaceutical, household and food/beverage markets. AptarGroup is headquartered in Crystal Lake, Illinois, with manufacturing facilities in North America, Europe, Asia and South America. For more information, visit the AptarGroup web site atwww.aptargroup.com.
This press release contains forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are based on management’s beliefs as well as assumptions made by and information currently available to management. Accordingly, the Company’s actual results may differ materially from those expressed or implied in such forward-looking statements due to known or unknown risks and uncertainties that exist including, but not limited to, those related to overall business conditions in the various markets in which the Company operates, fiscal and monetary policy, changes in foreign exchange rates, direct or indirect consequences of acts of war or terrorism and other risks and uncertainties discussed from time to time in the Company’s filings with the Securities and Exchange Commission, including its Form 10-K’s and 10-Q’s. Readers are cautioned not to place undue reliance on forward-looking statements.
# # #
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(In Thousands, Except Per Share Data)
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED | ||||||||||||||||
MARCH 31, 2003 | MARCH 31, 2002 | |||||||||||||||
Reported | Reported | Nonrecurring Charges (1) | Excluding Nonrecurring Charges | |||||||||||||
Net Sales | $ | 265,149 |
| $ | 218,707 |
| $ | 218,707 |
| |||||||
Cost of Sales |
| 172,588 |
|
| 139,761 |
|
| 139,761 |
| |||||||
Selling, Research & Development and Administrative |
| 41,449 |
|
| 35,060 |
|
| 35,060 |
| |||||||
Depreciation and Other Amortization |
| 20,772 |
|
| 17,417 |
|
| 70 |
|
| 17,347 |
| ||||
Strategic Initiative Costs: | ||||||||||||||||
Severance and Other |
| — |
|
| 29 |
|
| 29 |
|
| — |
| ||||
Patent Dispute Settlement |
| — |
|
| 4,168 |
|
| 4,168 |
|
| — |
| ||||
Operating Income |
| 30,340 |
|
| 22,272 |
|
| (4,267 | ) |
| 26,539 |
| ||||
Other: | ||||||||||||||||
Interest Expense |
| (2,409 | ) |
| (2,801 | ) |
| (2,801 | ) | |||||||
Interest Income |
| 623 |
|
| 330 |
|
| 330 |
| |||||||
Equity in Results of Affiliates |
| 182 |
|
| (111 | ) |
| (111 | ) | |||||||
Minority Interests |
| (19 | ) |
| (30 | ) |
| (30 | ) | |||||||
Miscellaneous, net |
| 164 |
|
| 63 |
|
| — |
|
| 63 |
| ||||
Income before Income Taxes |
| 28,881 |
|
| 19,723 |
|
| (4,267 | ) |
| 23,990 |
| ||||
Provision for Income Taxes |
| 9,675 |
|
| 6,448 |
|
| (1,469 | ) |
| 7,917 |
| ||||
Net Income | $ | 19,206 |
| $ | 13,275 |
| $ | (2,798 | ) | $ | 16,073 |
| ||||
Net Income per Share—Basic | $ | .53 |
| $ | .37 |
| $ | (.08 | ) | $ | .45 |
| ||||
Net Income per Share—Diluted | $ | .53 |
| $ | .36 |
| $ | (.08 | ) | $ | .44 |
| ||||
Average Number of Shares—Basic |
| 35,937 |
|
| 35,863 |
|
| 35,863 |
|
| 35,863 |
| ||||
Average Number of Shares—Diluted |
| 36,504 |
|
| 36,679 |
|
| 36,679 |
|
| 36,679 |
| ||||
Notes to Condensed Consolidated Financial Statements:
| (1) | Nonrecurring charges in 2002 represents charges relating to a patent dispute settlement and the Company’s Strategic Initiative. Results excluding nonrecurring charges have been presented as management believes that excluding these charges is a better reflection of normal on-going operating results. |
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
CONSOLIDATED BALANCE SHEETS
March 31, 2003 | December 31, 2002 | |||||
ASSETS | ||||||
Cash and Equivalents | $ | 105,116 | $ | 90,205 | ||
Receivables, net |
| 222,421 |
| 197,881 | ||
Inventories |
| 138,238 |
| 127,828 | ||
Other Current Assets |
| 32,739 |
| 31,282 | ||
Total Current Assets |
| 498,514 |
| 447,196 | ||
Net Property, Plant and Equipment |
| 443,760 |
| 434,817 | ||
Goodwill, net |
| 130,353 |
| 128,930 | ||
Other Assets |
| 37,479 |
| 36,728 | ||
Total Assets | $ | 1,110,106 | $ | 1,047,671 | ||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||
Short-Term Obligations | $ | 7,595 | $ | 7,722 | ||
Accounts Payable and Accrued Liabilities |
| 169,336 |
| 154,966 | ||
Total Current Liabilities |
| 176,931 |
| 162,688 | ||
Long-Term Obligations |
| 230,505 |
| 219,182 | ||
Deferred Liabilities |
| 71,396 |
| 71,334 | ||
Total Liabilities |
| 478,832 |
| 453,204 | ||
Stockholders’ Equity |
| 631,274 |
| 594,467 | ||
Total Liabilities and Stockholders’ Equity | $ | 1,110,106 | $ | 1,047,671 | ||
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
SEGMENT INFORMATION
THREE MONTHS ENDED MARCH 31, | ||||||||
2003 | 2002 | |||||||
NET SALES | ||||||||
Dispensing Systems | $ | 219,168 |
| $ | 180,027 |
| ||
SeaquistPerfect |
| 47,866 |
|
| 41,614 |
| ||
Intersegment Eliminations |
| (1,885 | ) |
| (2,934 | ) | ||
Total Net Sales | $ | 265,149 |
| $ | 218,707 |
| ||
EARNINGS (1) | ||||||||
Dispensing Systems | $ | 29,899 |
| $ | 26,108 |
| ||
SeaquistPerfect |
| 4,568 |
|
| 3,167 |
| ||
Corporate Expenses and Other |
| (3,800 | ) |
| (2,814 | ) | ||
Strategic Initiative Charges (2) |
| — |
|
| (99 | ) | ||
Patent Dispute Settlement (2) |
| — |
|
| (4,168 | ) | ||
Earnings before Interest and Taxes (EBIT) |
| 30,667 |
|
| 22,194 |
| ||
Less: Interest Expense, Net |
| 1,786 |
|
| 2,471 |
| ||
Income before Income Taxes | $ | 28,881 |
| $ | 19,723 |
| ||
Notes to Condensed Consolidated Financial Statements:
| (1) | The Company evaluates performance of its business units and allocates resources based upon earnings before interest expense in excess of interest income, corporate expenses and income taxes (collectively referred to as “EBIT”) excluding unusual items. |
| (2) | Strategic Initiative Charges and the Patent Dispute Settlement relate to the Dispensing Systems segment. |
