Exhibit 99.1
AptarGroup Reports Record Third Quarter Results; Expands Presence in South
America; Declares Dividend
CRYSTAL LAKE, Ill.--(BUSINESS WIRE)--Oct. 18, 2006--AptarGroup,
Inc. (NYSE:ATR) today reported record third quarter results and
announced strategic acquisitions in Brazil and Argentina. The
Company's Board of Directors also declared a quarterly dividend.
Third Quarter 2006 Highlights
-- Set a new quarterly sales record of $404.9 million, up 19%
-- Achieved record third quarter EPS of $.80 per share
-- Grew each business segment's results over the prior year -
sales to the fragrance/cosmetic and personal care markets were
particularly strong
-- Increased South American footprint with key acquisitions
-- Repurchased approximately 426,000 shares
THIRD QUARTER RESULTS
For the quarter ended September 30, 2006, sales increased 19% to a
record $404.9 million from $341.1 million in the prior year. Sales,
excluding acquisitions and exchange rate effects, grew approximately
8% while sales from acquired companies added approximately $26.5
million, or 8% of growth, and exchange rate movements added another
3%.
Commenting on the quarter, Carl A. Siebel, President and Chief
Executive Officer, said, "I'm pleased to report that each of our
business segments generated sales and profit growth. Our strongest
performance came from our Beauty & Home segment with increased demand
for our innovative dispensing from the fragrance/cosmetic and personal
care markets. Overall Beauty & Home segment sales increased 26%, of
which 13% came from acquired companies and 4% came from exchange rate
movements. In our Closures segment, demand from the food/beverage
market and resin cost-related price adjustments helped increase sales
over the prior year. Closures segment sales increased 16%, of which 4%
came from acquired companies, with 2% coming from changes in exchange
rates. Pharma segment sales increased 6%, with 3% coming from changes
in exchange rates and the balance mainly from increased sales of our
metered dose valves and custom tooling."
Operating income increased to a record $44.6 million, up 15% from
$38.7 million a year ago. The 2006 operating income included a
negative impact of $2.1 million related to the expensing of stock
options that began in 2006, and the prior year's results included a
negative impact of $3 million related to a previously announced
Redeployment Program in France. Beauty & Home segment income increased
48% to $18.5 million primarily due to increased product sales to the
fragrance/cosmetic and personal care markets, cost containment efforts
and the absence of Redeployment Program charges recorded in the prior
year. Closures segment income rose 4% to $11.8 million due to stronger
product sales and Pharma segment income increased 7% to $21.7 million
due to the positive effects of increased product demand.
Diluted earnings per share increased 16% to $.80 per share
compared to $.69 per share in the prior year. Included in 2006
earnings per share is a negative impact of approximately $.04 per
share related to stock option expense and included in prior year
earnings per share is the negative impact of approximately $.06 per
share related to the Redeployment Program. Acquisitions did not have a
significant effect on 2006 third quarter earnings per share.
Siebel added, "Our product, market and geographic diversity,
combined with our continuing innovation and cost containment efforts
have once again produced solid returns for our shareholders."
YEAR-TO-DATE RESULTS
For the year-to-date, sales increased 13% to a record $1.2 billion
from $1.0 billion a year ago. Changes in exchange rates had no effect
and acquisitions added 7% or $77.8 million to AptarGroup's top line.
Operating income increased to a record $120.8 million, up 6% from
$114.2 million a year ago. The 2006 operating income included a
negative impact of $11.3 million related to the expensing of stock
options that began in 2006, and the prior year's results included a
negative impact of $3 million related to the Redeployment Program
mentioned above.
Diluted earnings per share equaled the prior year amount of $2.10
per share. Included in the 2006 earnings per share is a negative
impact of approximately $.20 per share related to stock option
expense. The 2005 earnings per share included a positive impact of
approximately $.09 per share related to reduced income taxes recorded
in the second quarter of 2005 and the negative impact of approximately
$.06 per share related to the Redeployment Program. For 2006,
acquisitions contributed approximately $.04 per diluted share to
earnings.
SOUTH AMERICAN ACQUISITIONS
During the third quarter, AptarGroup acquired Augros do Brasil
Ltda, a Brazilian injection molder and decorator of aesthetic plastic
accessories mainly for the fragrance/cosmetic market, and also
acquired the remaining 65% ownership of H. Engelmann S.A.I.C.F. e l.,
a leading closure supplier in Argentina. The total purchase price for
these acquisitions was approximately $15 million including
approximately $13 million in cash and $2 million in assumed debt.
Combined annual revenue of the two companies is approximately $17
million.
Commenting on the acquisitions, Siebel said, "We have been a
minority owner of H. Engelmann for many years and we can now fully
leverage their technical abilities and market reputation to support
the growing demands of our closure customers in the Mercosur region.
Augros' molding and decorative abilities are complementary to our
product offerings and will allow us to better serve our
fragrance/cosmetic customers in this growing market."
OUTLOOK
Siebel commented, "We anticipate that sales across each of our
business segments will continue to improve over prior year levels in
the fourth quarter and AptarGroup will report another strong full-year
performance. Despite the continued challenges of rising raw material
costs, competitive price pressures and increasing customer quality
demands, heading into the fourth quarter we are cautiously optimistic
about our future profitability. We expect strong customer demand for
our innovative dispensing systems and the positive impact from our
recent acquisitions to continue. We estimate that diluted earnings per
share for the fourth quarter, including the adverse effect of $.04 per
share relating to expensing of stock options in 2006, will be in the
range of $.67 to $.72 per share compared to $.66 per share in the
prior year."
CASH DIVIDEND AND SHARE REPURCHASE PROGRAM
The Board of Directors declared a quarterly dividend of $.22 per
share, payable November 22, 2006 to shareholders of record as of
November 1, 2006. Also, during the quarter, the Company repurchased
approximately 426,000 shares of common stock leaving approximately 2.2
million shares authorized for repurchase at the end of the third
quarter.
OPEN CONFERENCE CALL
There will be a conference call on Thursday October 19, 2006 at
8:00 a.m. CDT to discuss the Company's third quarter results for 2006.
The call will last approximately one hour. 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 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, AptarGroup'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
AptarGroup operates, the competitive marketplace, fiscal and monetary
policy, changes in foreign exchange rates, direct or indirect
consequences of acts of war or terrorism, labor relations and other
risks and uncertainties discussed from time to time in AptarGroup'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 Nine Months Ended
September 30, September 30,
-----------------------------------------------
2006 (1) 2005 2006 (2) 2005
----------- ----------- ----------- -----------
Net Sales $404,905 $341,084 $1,178,998 $1,041,195
Cost of Sales
(exclusive of
depreciation shown
below) 274,517 228,742 796,821 699,861
Selling, Research &
Development and
Administrative 57,406 49,613 177,863 152,313
Depreciation and Other
Amortization 28,340 23,985 83,503 74,799
----------- ----------- ----------- -----------
Operating Income 44,642 38,744 120,811 114,222
Other Income/(Expense):
Interest Expense (4,479) (3,025) (12,186) (8,789)
Interest Income 1,012 771 2,753 2,333
Equity in Results of
Affiliates 177 382 420 1,217
Minority Interests 38 12 (94) 83
Miscellaneous, net (219) (6) (1,154) (844)
----------- ----------- ----------- -----------
Income before Income
Taxes 41,171 36,878 110,550 108,222
Provision for Income
Taxes 12,928 11,948 34,829 31,900
----------- ----------- ----------- -----------
Net Income $28,243 $24,930 $75,721 $76,322
=========== =========== =========== ===========
Net Income per Share -
Basic $0.82 $0.71 $2.17 $2.16
=========== =========== =========== ===========
Net Income per Share -
Diluted $0.80 $0.69 $2.10 $2.10
=========== =========== =========== ===========
Average Number of
Shares - Basic 34,646 34,988 34,919 35,282
Average Number of
Shares - Diluted 35,439 36,010 36,033 36,313
Notes to Condensed Consolidated Financial Statements:
(1) - For the third quarter 2006, the following amounts related to
stock option expenses are included in the respective lines of the
above table: Cost of Sales ($.2 million), Selling, Research &
Development and Administrative ($1.9 million), Income Before Income
Taxes ($2.1 million), Net Income ($1.4 million), and Net Income per
Share - Basic and Diluted ($.04 per share).
(2) - For the year-to-date 2006, the following amounts related to
stock option expenses are included in the respective lines of the
above table: Cost of Sales ($.7 million), Selling, Research &
Development and Administrative ($10.6 million), Income Before Income
Taxes ($11.3 million), Net Income ($7.4 million), and Net Income per
Share - Basic and Diluted ($.20 per share).
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2006 2005
ASSETS
Cash and Equivalents $168,244 $117,635
Receivables, net 310,360 260,175
Inventories 215,270 184,241
Other Current Assets 52,228 43,240
---------------- ----------------
Total Current Assets 746,102 605,291
Net Property, Plant and Equipment 576,256 536,820
Goodwill, net 206,346 184,763
Other Assets 27,979 30,445
---------------- ----------------
Total Assets $1,556,683 $1,357,319
================ ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-Term Obligations $113,423 $102,103
Accounts Payable and Accrued
Liabilities 270,315 218,659
---------------- ----------------
Total Current Liabilities 383,738 320,762
Long-Term Obligations 193,021 144,541
Deferred Liabilities 84,950 82,628
---------------- ----------------
Total Liabilities 661,709 547,931
Stockholders' Equity 894,974 809,388
---------------- ----------------
Total Liabilities and Stockholders'
Equity $1,556,683 $1,357,319
================ ================
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
SEGMENT INFORMATION
Three Months Ended Nine Months Ended
September 30, September 30,
----------------------- -----------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
SALES
Beauty & Home $214,084 $170,833 $623,119 $529,799
Closures 114,111 97,955 329,571 295,256
Pharma 79,019 74,400 235,662 223,976
Other 290 416 902 1,082
----------- ----------- ----------- -----------
Total Sales $407,504 $343,604 $1,189,254 $1,050,113
=========== =========== =========== ===========
INTERSEGMENT
ELIMINATIONS
Beauty & Home $(1,684) $(1,686) $(7,828) $(5,661)
Closures (303) (251) (833) (1,070)
Pharma (387) (340) (955) (1,442)
Other (225) (243) (640) (745)
----------- ----------- ----------- -----------
Total Intersegment
Eliminations $(2,599) $(2,520) $(10,256) $(8,918)
=========== =========== =========== ===========
NET SALES
Beauty & Home $212,400 $169,147 $615,291 $524,138
Closures 113,808 97,704 328,738 294,186
Pharma 78,632 74,060 234,707 222,534
Other 65 173 262 337
----------- ----------- ----------- -----------
Total Net Sales $404,905 $341,084 $1,178,998 $1,041,195
=========== =========== =========== ===========
SEGMENT INCOME (1)
Beauty & Home $18,487 $12,473 $54,872 $42,954
Closures 11,825 11,361 34,548 31,972
Pharma 21,731 20,234 58,642 56,791
Corporate Expenses and
Other (2) (7,405) (4,936) (28,079) (17,039)
----------- ----------- ----------- -----------
Income before Interest
and Taxes 44,638 39,132 119,983 114,678
Less: Interest Expense,
Net 3,467 2,254 9,433 6,456
----------- ----------- ----------- -----------
Income before Income
Taxes $41,171 $36,878 $110,550 $108,222
=========== =========== =========== ===========
Notes to Condensed Consolidated Financial Statements:
(1) - The Company evaluates performance of its business units and
allocates resources based upon income before interest expense in
excess of interest income, stock option and corporate expenses,
income taxes and unusual items.
(2) - For the third quarter and year-to-date 2006, Corporate Expenses
and Other includes the total amounts related to stock option expenses
of $2.1 million and $11.3 million, respectively.
CONTACT: AptarGroup, Inc.
Stephen J. Hagge, 815-477-0424