Bemis Company Reports Third Quarter Results.NEENAH, Wis. -- Bemis Company Bemis Company, Inc. is an American manufacturer of flexible packaging products and pressure-sensitive materials, which are distributed worldwide. Bemis is part of the S&P 500 index. References
See: New York Stock Exchange :BMS BMS abbr. Bachelor of Marine Science ) today reported quarterly diluted earnings of $0.45 per share for the third quarter ended September 30, 2006, which included $0.03 per share of restructuring and related charges. Excluding the impact of restructuring and related charges, diluted earnings would have been $0.48 per share for the third quarter of 2006 compared to $0.41 per share for the same quarter of 2005, an 18.7 percent improvement. (See attached schedule: "Reconciliation of Non-GAAP Data".) Third quarter net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight increased 3.8 percent to a third quarter record of $903.3 million from $870.1 million in the prior year. Commenting on the results of the third quarter, Jeff Curler, Bemis Company's Chairman, President and Chief Executive Officer, said, "I am pleased to report strong earnings growth again this quarter. Our capacity expansion efforts in key product lines are on schedule, and our 2006 restructuring effort to consolidate capacity into more efficient facilities is nearly complete. Our market-focused business teams are successfully implementing growth strategies aimed at maintaining our leadership positions in key markets and growing our position in new product markets and regions of the world." BUSINESS SEGMENTS Flexible Packaging Flexible packaging, which represented about 83 percent of total Company net sales during the quarter, reported record net sales of $749.1 million in the third quarter, an increase of 3.6 percent compared to the same quarter in 2005. Currency effects accounted for sales growth of 2.0 percent. Segment operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the third quarter of 2006 was $92.0 million, or 12.3 percent of net sales, which included restructuring and related charges of $5.1 million. Restructuring and related charges of $5.1 million reflect the costs associated with our previously announced facility consolidation efforts that include the closure of five flexible packaging plants. Segment operating profit for the third quarter of 2005 was $89.0 million. Excluding restructuring and related charges, segment operating profit as a percentage of net sales would have increased to 13.0 percent from 12.3 percent a year ago. Commenting on the flexible packaging business segment results for the quarter, Curler said, "We have accomplished a significant culture change in our flexible packaging segment this year. While our core aptitude for innovation, value-added products and customer intimacy continue to drive top line growth, we are improving the efficiency of our capital assets capital assets n. equipment, property, and funds owned by a business. (See: capital, capital account) with productivity initiatives and quality-oriented cost management efforts. These improvements will continue to spread throughout the organization and deliver a greater return on capital and a more efficient platform for future expansion. This quarter, we enjoyed strong sales growth in our largest market, meat and cheese, and double-digit sales growth in a number of other important markets, including medical device, health and hygiene, bakery, multipack and pet products. Raw material cost increases during the third quarter dampened operating margins as selling price adjustments lagged cost increases. Sales mix sales mix See product mix. improvements offset some of the short-term impact of the raw material cost increases. Our customers have announced growth strategies that depend on the success of innovative new products and marketing initiatives. We are pleased to be an integral player in these customer growth strategies and are well-positioned to meet the demands of our markets." Pressure Sensitive Materials Third quarter net sales from the pressure sensitive materials business segment were $154.2 million, a 4.8 percent increase from the third quarter of 2005. Currency effects accounted for sales growth of 2.3 percent. Segment operating profit of $11.4 million, or 7.4 percent of net sales, included restructuring and related charges of $0.6 million related to the previously announced closure of one plant. Excluding the impact of these charges, segment operating profit would have been $12.0 million or 7.8 percent of net sales for the quarter compared to the third quarter of 2005 when segment operating profit was $8.7 million or 5.9 percent of net sales. Commenting on the results of the pressure sensitive materials business segment, Curler noted, "This segment has achieved steady improvement in operating profit. We have substantially improved production efficiencies to create added capacity and reduced waste to control costs. Continued volume growth, especially in the higher margin graphic and technical product lines, is evidence of the strength of this business and an effective growth strategy. Product innovation and ongoing quality service improvements will be an integral part of this segment's future sales growth." Restructuring and Related Charges In January of 2006, the Company announced the planned closure of five flexible packaging facilities and one pressure sensitive materials facility in order to consolidate production capacity and improve overall cost structure and efficiency. These efforts were substantially complete as of September 30, 2006. Restructuring and related charges incurred during the third quarter totaled $5.5 million, primarily related to employee costs and recorded as a component of other costs (income). Other Costs (Income), Net During the third quarter of 2006, other costs and income included $5.0 million of costs resulting from the 2006 restructuring activities. These charges were offset by $5.5 million of financial income and a $4.4 million favorable resolution of a litigated foreign excise tax Excise Tax 1. An indirect tax charged on the sale of a particular good. 2. A penalty tax applied to ineligible transactions in retirement accounts. This penalty is assessed by and paid to the IRS. Notes: 1. liability. Capital Structure Total debt to total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. was 32.2 percent at September 30, 2006, compared to 35.7 percent at December 31, 2005. Total debt as of September 30, 2006 was $781.7 million, a decrease of $62.4 million from the balance of $844.1 million at December 31, 2005. Strong cash flows for the nine months ended September 30, 2006, were used to support dividend payments, a strong 2006 capital expenditure program, share repurchases and debt reduction. 2006 Earnings Outlook Management expects fourth quarter 2006 diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of to be in the range of $0.41 to $0.44 per share including a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of approximately $0.04 per share. Management continues to expect capital expenditures to be in the $175 to $185 million range for 2006. Presentation of Non-GAAP Information Some of the information presented in this press release reflects adjustments to "As reported" results to exclude certain amounts related to the Company's restructuring initiative. This adjusted information should not be construed as an alternative to the reported results determined in accordance with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting in the United States of America UNITED STATES OF AMERICA. The name of this country. The United States, now thirty-one in number, are Alabama, Arkansas, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, New Hampshire, (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ). It is provided solely to assist in an investor's understanding of the impact of the Company's restructuring initiative on the comparability of the Company's operations. A reconciliation of the GAAP amounts to the non-GAAP amounts is included with this press release. Additional details related to these non-GAAP disclosures are provided in the Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. that the Company filed with the Securities and Exchange Commission on the date of this press release. Forward Looking Statements Statements in this release that are not historical, including statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the expected future performance of the Company, are considered "forward-looking" and are presented pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Securities Litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called 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, changes in customer order patterns, the results of competitive bid processes, estimates of restructuring and related charges, 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 Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2005. Bemis Company, Inc. will Webcast an investor telephone conference regarding its third quarter 2006 financial results this morning at 10 a.m., Eastern Daylight Time. Individuals may listen to the call on the Internet at www.bemis.com under "Investor Relations Investor relations The process by which the corporation communicates with its investors. ". However, they 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 2005 net sales of $3.5 billion. The Company's flexible packaging business has a strong technical base in polymer chemistry Polymer chemistry or macromolecular chemistry is a multidisciplinary science that deals with the chemical synthesis and chemical properties of polymers or macromolecules. , film extrusion, coating and laminating, printing and converting. The Company's pressure sensitive materials business specializes in adhesive technologies. Headquartered in Neenah, Wisconsin Neenah is a city on Lake Winnebago in Winnebago County, Wisconsin, United States. The population was 24,507 at the 2000 census. The city is surrounded by, but is politically independent of, the Town of Neenah. , Bemis employs about 16,000 individuals in 56 manufacturing facilities in 10 countries around the world. More information about the Company is available at our website, www.bemis.com. [TABLE OMITTED] [TABLE OMITTED] |
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