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EMPAQUES PONDEROSA REPORTS RECORD 1991 FINANCIAL RESULTS

 EMPAQUES PONDEROSA REPORTS RECORD 1991 FINANCIAL RESULTS
 NEW YORK, Feb. 18 /PRNewswire/ -- Empaques Ponderosa, S.A.


(Mexican Stock Exchange: EMPAQ), Mexico's largest producer of folding paperboard from recycled materials, today reported that net income rose around 17.8 percent to 51,885 million Mexican pesos (US$16.9 million) as of Dec. 31, 1991, vs. 44,035 million Mexican pesos ($14.3 million) in 1990 (according to the rate of exchange as of Dec. 31, 1991). Earnings per ADS increased to $1.12 in 1991. This increase is related to the first-year expansion of the operations made in late 1990 when the production capacity of the company was increased from 105,000 to 130,000 metric tons per year.
 Gross tonnage sold in 1991 reached 112,500 metric tons, increasing 21.3 percent over tonnage in 1990. However, the product mix of the company was geared toward lower priced but higher margin products, dedicating 100 percent of its production for the year to paperboard made from recycled material instead of partially producing aseptic paperboard, which is a higher priced but lower margin product. This fact caused the net sales figure of the company to increase only 4.2 percent while gross profit rose 18.3 percent to 91,072 million pesos ($29.6 million).
 As a result of its expansion and of this strategy, Empaques Ponderosa increased its share of market among Mexican producers from 34 percent in 1990 to 41 percent in the first quarter of 1991 and 45 percent in the third quarter of 1991.
 Increased sales and the company's exercise of tighter fiscal controls generated a reduction in fixed costs and SG&A expenses and raised operating profit by 22 percent.
 Long-term liabilities increased 88 percent for the year due to long- term financing obtained by the company for use in projects, investment in fixed assets and dividend payments.
 A 69 percent increase in current assets primarily reflects cash reserved for future investment programs.
 In September 1991, Empaques offered shares on the Mexican stock market and issued ADRs in foreign markets, as Rule 144A private placement in the United States, and under Regulation S in Europe. These programs placed 36.3 percent of the company's shares for $65 million, $55 million of which corresponded to a secondary issue of shares owned by Ponderosa Industrial, S.A. de C.V., a major Mexican forest products producer which holds 63.7 percent of Empaques' capital stock. Empaques realized $10 million from this initial offering of its shares.
 Empaques Ponderosa is Mexico's largest producer of coated paperboard for folding packaging manufactured with recyclable materials. These products are used to produce packaging for a variety of consumer goods, including cereals, medicines, toothpaste and perfumes. Empaques also enjoys a significant competitive advantage in this industry through its technologies for processing recyclable paper and for water treatment, its geographic location, and its proximity to abundant resources and to the largest market of the country, Mexico City. It is a leader in one of Mexico's strongest growth industries.
 EMPAQUES PONDEROSA, S.A
 Summary of Financial Information
 1991(A) vs. 1990
 Millions Mexican Pesos Millions of Dollars
 as of Dec. 31, 1991 as of Dec. 31, 1991(B)
 1990 1991 1990 1991 Variation
 (Percent)
 Sales in tons(C) 92,776 112,500 -- -- 21.3
 Net sales 226,842 236,469 73.7 76.8 4.2
 Gross profit 76,977 91,072 25.0 29.6 18.3
 Operating profit 65,450 80,007 21.3 26.0 22.2
 Net profit 44,035 51,885 14.3 16.9 17.8
 Current assets 65,537 110,875 21.3 36.0 69.2
 Fixed assets 338,347 313,310 109.9 101.8 (7.4)
 Other assets 7,464 17,557 2.4 5.7 135.3
 Current liabilities 58,884 60,147 19.1 19.5 2.1
 Long-term
 liabilities 67,661 127,413 22.0 41.4 88.3
 Total liabilities 126,546 187,560 41.1 60.9 48.2
 Equity 284,803 254,182 92.5 82.6 (10.7)
 Share information(D)
 Book value 4,734 4,225 1.5 1.4 (10.7)
 Profit/share 732 862 0.2 0.3 17.8
 (A) -- Unaudited figures as of today.
 (B) -- Exchange rate $3,078.
 (C) -- Information in metric tonnage.
 (D) -- Assuming a total of 60,166,667 shares, outstanding as of Dec. 31, 1991.
 -0- 2/18/92
 /CONTACT: Alfredo Schultz of Ponderosa Industrial, in Mexico, 14-18-08-98; or Roberto X. Margain of Grupo Chihuahua, in Mexico, 14-18-08-98, for Empaques Ponderosa/ CO: Empaques Ponderosa, S.A. ST: IN: PAP SU: ERN


GK-OS -- NY100 -- 0141 02/18/92 16:59 EST
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Date:Feb 18, 1992
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