Exhibit 99.1
AptarGroup Reports Record Second Quarter Results; Doubles Dividend and Increases
Share Repurchase Authorization
CRYSTAL LAKE, Ill.--(BUSINESS WIRE)--July 15, 2004--AptarGroup, Inc.
(NYSE:ATR) today reported record second quarter results. The Company's Board of
Directors also increased the quarterly dividend to $.15 per share from $.07 per
share and authorized the repurchase of an additional two million shares of
common stock.
SECOND QUARTER RESULTS
For the quarter ended June 30, 2004, sales increased eight percent to a
record $311.8 million from $288.1 million in the prior year. Approximately $2
million of the increase in sales relates to increased custom tooling sales.
Sales excluding changes in foreign currency exchange rates increased
approximately four percent from the prior year. Net income for the second
quarter of 2004 increased to a record $22.8 million from $21.3 million a year
ago. Diluted earnings per share were $.61 per share compared to $.58 per share
in the prior year.
SIX MONTHS RESULTS
For the six months ended June 30, 2004, sales increased 13 percent to a
record $627.4 million from $553.2 million in the prior year. Approximately $13
million of the increase in sales relates to increased custom tooling sales.
Sales excluding changes in foreign currency exchange rates increased
approximately six percent from the prior year. Net income for the first six
months of 2004 increased to a record $44.0 million from $40.6 million a year
ago. Diluted earnings per share were $1.18 per share compared to $1.11 per share
in the prior year.
MANAGEMENT COMMENT
Commenting on the quarter, Carl A. Siebel, President and Chief Executive
Officer, said, "Increased demand for our products together with the weak U.S.
dollar vis-a-vis the Euro contributed to another quarter of growth and record
sales for the Company. Excluding changes in exchange rates, sales to each market
increased compared to a year ago with the exception of the pharmaceutical
market, which, even though volumes increased year over year, showed a decline
due to the mix of products sold. However, this decline in pharmaceutical product
sales was largely offset by milestone revenue of $1 million related to a
pharmaceutical customer project."
Siebel added, "Our operating margins were pressured due to material price
increases, price competition, the adverse effects of the weaker dollar on U.S.
imports, and costs associated with the previously announced closing of a mold
making facility. The Company recorded approximately $1 million of costs related
to operating losses and shut down expenses of this facility in the quarter. The
closing has been completed and we do not expect to incur any future significant
costs related to this operation. In spite of these negative effects, the
strength of our core business, the pharmaceutical project milestone, our cost
containment efforts and lower income tax rates allowed us to post record
quarterly earnings per share."
BUSINESS SEGMENT PERFORMANCE
For the quarter, sales of the Dispensing Systems segment increased eight
percent, to $261.9 million from $243.2 million in the prior year. The increase
is mainly due to increased sales to the food/beverage, personal care and
fragrance/cosmetic markets and changes in exchange rates. For the first six
months, sales increased 13 percent to $524.1 million from $462.3 million in the
prior year. Second quarter EBIT (earnings before interest and taxes) for the
Dispensing Systems segment increased to $35.0 million from $33.9 million in the
prior year. For the first six months, EBIT for the segment increased to $66.3
million from $63.8 million in the prior year.
For the quarter, sales of the SeaquistPerfect segment increased 11 percent,
to $52.1 million from $46.8 million in the prior year. The increase is due to
improved sales to the personal care and household markets, and the weaker U.S.
dollar. For the first six months, sales increased 14 percent to $107.8 million
from $94.7 million in the prior year. Second quarter EBIT for the
SeaquistPerfect segment increased to $4.8 million from $4.2 million a year ago
due to the mix of products sold and continued cost savings. For the first six
months, EBIT increased to $10.1 million from $8.8 million in the prior year.
OUTLOOK
Siebel commented, "Looking to the third quarter, we are optimistic that
product sales to each of the markets we serve will increase over the prior year.
As I discussed in our first quarter press release, we continue to expect sales
to the pharmaceutical market to improve as the year progresses.
Siebel concluded, "Also, as previously mentioned last quarter, we have
filed for income tax refunds totaling approximately $1.5 million in the U.S.
relating to research and development expenditures incurred from 2000 through
2002. These refunds will be recognized as a reduction of our tax provision when
they are received. Excluding the potential effect of these tax refunds net of
related contingent consulting fees, we anticipate diluted earnings per share for
the third quarter of 2004 to be in the range of $.62 to $.67 compared to $.51
per share in the prior year."
CASH DIVIDEND INCREASE AND SHARE REPURCHASE PROGRAM
The Board of Directors increased the quarterly dividend to $.15 per share,
payable August 17, 2004 to shareholders of record as of July 27, 2004. This
represents a 114% increase over the previous quarterly dividend of $.07 per
share. During the quarter, the Company repurchased 100,000 shares of common
stock under the current share repurchase program. Previously, the Board had
authorized the Company to purchase up to three million share of common stock on
the open market, of which one and one half million shares have been purchased
cumulatively through the second quarter of 2004. The Board today approved the
repurchase of an additional two million shares under the program bringing the
total authorized to five million shares.
Siebel commented, "Our strong financial position and cash generating
ability has enabled the Board to take steps to enhance shareholder value. This
substantial increase in the dividend rate, in combination with the increase in
our share repurchase authorization, reflects our confidence in our business and
our commitment to improving shareholder returns. Also, with our strong balance
sheet, we remain well positioned to take advantage of strategic opportunities in
the future."
OPEN CONFERENCE CALL
There will be a conference call on Friday, July 16, 2004 at 8:00 a.m. CDT
to discuss the Company's second quarter results for 2004. 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 at
www.aptargroup.com. Replay of the conference call can also be accessed on the
Investor Relations page of the web site.
AptarGroup, Inc. is a leading global supplier of a broad range of
innovative dispensing systems for the fragrance/cosmetic, personal care,
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 at http://www.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 SIX MONTHS ENDED
JUNE 30, JUNE 30,
--------- --------- --------- ---------
2004 2003 2004 2003
--------- --------- --------- ---------
Net Sales $311,844 $288,087 $627,447 $553,236
Cost of Sales (exclusive of
depreciation shown below) 206,202 188,285 417,783 360,873
Selling, Research & Development
and Administrative 46,793 44,849 95,062 86,298
Depreciation and Other
Amortization 23,433 21,540 47,483 42,312
--------- --------- --------- ---------
Operating Income 35,416 33,413 67,119 63,753
Other Income/(Expense):
Interest Expense (2,495) (2,427) (4,724) (4,836)
Interest Income 872 689 1,890 1,312
Equity in Results of Affiliates 251 156 693 338
Minority Interests (153) (98) (272) (117)
Miscellaneous, net (388) 226 25 390
--------- --------- --------- ---------
Income before Income Taxes 33,503 31,959 64,731 60,840
Provision for Income Taxes 10,721 10,610 20,714 20,285
--------- --------- --------- ---------
Net Income $22,782 $21,349 $44,017 $40,555
========= ========= ========= =========
Net Income per Share - Basic $0.62 $0.59 $1.21 $1.13
========= ========= ========= =========
Net Income per Share - Diluted $0.61 $0.58 $1.18 $1.11
========= ========= ========= =========
Average Number of Shares -
Basic 36,527 36,031 36,464 35,984
Average Number of Shares -
Diluted 37,462 36,856 37,377 36,666
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
CONSOLIDATED BALANCE SHEETS
June 30, 2004 December 31, 2003
ASSETS
Cash and Equivalents $187,068 $164,982
Receivables, net 246,326 231,976
Inventories 176,496 165,207
Other Current Assets 27,524 40,289
----------------- -----------------
Total Current Assets 637,414 602,454
Net Property, Plant and Equipment 473,717 483,431
Goodwill, net 135,171 136,660
Other Assets 44,664 41,798
----------------- -----------------
Total Assets $1,290,966 $1,264,343
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-Term Obligations $68,573 $96,710
Accounts Payable and Accrued
Liabilities 199,508 186,510
----------------- -----------------
Total Current Liabilities 268,081 283,220
Long-Term Obligations 147,374 125,196
Deferred Liabilities 71,866 72,876
----------------- -----------------
Total Liabilities 487,321 481,292
Stockholders' Equity 803,645 783,051
----------------- -----------------
Total Liabilities and
Stockholders' Equity $1,290,966 $1,264,343
================= =================
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
SEGMENT INFORMATION
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
-------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
NET SALES
Dispensing Systems $261,879 $243,164 $524,114 $462,332
SeaquistPerfect 52,054 46,785 107,815 94,651
Intersegment Eliminations (2,089) (1,862) (4,482) (3,747)
--------- --------- --------- ---------
Total Net Sales $311,844 $288,087 $627,447 $553,236
========= ========= ========= =========
EARNINGS (1)
Dispensing Systems $34,970 $33,894 $66,267 $63,793
SeaquistPerfect 4,758 4,231 10,050 8,799
Corporate Expenses and Other (4,602) (4,428) (8,752) (8,228)
Strategic Initiative Charges - - - -
Patent Dispute Settlement - - - -
--------- --------- --------- ---------
Earnings before Interest and
Taxes (EBIT) 35,126 33,697 67,565 64,364
Less: Interest Expense, Net 1,623 1,738 2,834 3,524
--------- --------- --------- ---------
Income before Income Taxes $33,503 $31,959 $64,731 $60,840
========= ========= ========= =========
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.
CONTACT: AptarGroup, Inc.
Stephen J. Hagge, 815-477-0424