Glatfelter (NYSE: GLT) today reported 2015 full year adjusted
earnings per diluted share of $1.34 (GAAP $1.47) compared with
$1.55 per diluted share in 2014 (GAAP $1.57). For the 2015 fourth
quarter Glatfelter reported adjusted earnings of $22.9 million, or
$0.52 per diluted share, compared with $19.7 million, or $0.45 per
diluted share, in the 2014 fourth quarter. On a GAAP basis, fourth
quarter 2015 net income totaled $34.3 million, or $0.78 per diluted
share, compared with $19.6 million, or $0.45 per diluted share, in
the fourth quarter of 2014.
Consolidated net sales totaled $412.9 million in the fourth
quarter of 2015 compared with $436.3 million in the fourth quarter
of 2014. On a constant currency basis, net sales declined $5.1
million, or 1.2 percent.
“Our fourth-quarter 2015 financial results reflect a solid
finish to a very challenging year,” said Dante C. Parrini, Chairman
and Chief Executive Officer. “In the fourth quarter, we saw solid
growth in key product lines within our Composite Fibers and
Advanced Airlaid Materials businesses and earnings growth across
all three of our business segments. We also delivered improved
overall earnings and cash flow performance as the full effects of
our previously announced continuous improvement and cost reduction
initiatives were realized.
“Overall, I am pleased with how our team managed through the
many challenges we faced in 2015 by capitalizing on improved demand
for single-serve coffee, tea and Advanced Airlaid Materials
products during the second half of the year, and withstanding the
ongoing weakness in Russia and Ukraine and currency headwinds. Our
performance during the year was also driven by our successful
execution of cost reduction and continuous improvement initiatives
which delivered full year savings of $31 million, exceeding our
target for the year."
Mr. Parrini concluded, "As we enter 2016, we see growth
opportunities in food and beverage, feminine hygiene, specialty
wipes and electrical markets. At the same time, we remain mindful
of weakness in Russia and Ukraine, which continues to impact the
nonwoven wallcover market, as well as the effect of a weak Euro.
Our efforts to continuously improve the safety, reliability and
efficiency of our operations, manage costs, and bring new
value-added products to market will continue to be critical to our
success in 2016 and beyond."
The following table sets forth a reconciliation of net income on
a GAAP basis to adjusted earnings, a non-GAAP measure:
Three months ended
December 31
2015 2014 In thousands,
except per share
After taxamounts
Diluted EPS
After taxamounts
Diluted EPS Net income
$34,298 $0.78 $19,557 $0.45 Timberland sales and
related costs
(11,574) (0.26) (612) (0.01) Workforce
efficiency charges
147 - 373 0.01 AMBU capacity
expansion costs
30 - - - Acquisition and integration
related costs
- - 487 0.01
Alternative fuel mixture/Cellulosic
biofuel credits
- - (81)
- Adjusted earnings
$22,901
$0.52 $19,724
$0.45
The sum of individual per share amounts set forth above may not
agree to adjusted earnings per share due to rounding.
Fourth-Quarter Business Unit Results
Composite Fibers
Three months ended
December 31 Dollars in thousands
2015
2014 Change
Tons shipped
37,585 37,849 (264) (0.7)% Net sales
$131,821 $147,763 $(15,942) (10.8)% Operating income
15,883 13,578 2,305 17.0% Operating margin
12.0% 9.2%
Net sales for this business unit declined $15.9 million, or 10.8
percent, primarily due to $13.7 million of unfavorable currency
translation and $2.4 million from lower selling prices. Shipping
volumes declined slightly due to a 13.9 percent decline in nonwoven
wallcover which offset solid gains in all other market
segments.
Composite Fibers’ fourth-quarter 2015 operating income totaled
$15.9 million, a $2.3 million or 17.0 percent improvement compared
to the year-ago period. The higher operating income was due to
improved operating performance of $4.4 million driven by less
market-related downtime, higher production rates, and other
operating efficiencies and $2.5 million of lower raw material and
energy prices. These benefits more than offset the adverse impact
of lower selling prices and currency translation. The change in
currency exchange rates negatively impacted results by $1.7
million.
Advanced Airlaid Materials
Three months ended
December 31 Dollars in thousands
2015
2014 Change
Tons shipped
24,537 23,642 895 3.8% Net sales
$61,603 $65,483 $(3,880) (5.9)% Operating income
6,029 5,772 257 4.5% Operating margin
9.8% 8.8%
Advanced Airlaid Materials’ net sales decreased $3.9 million
largely due to $4.6 million of unfavorable currency translation and
a $1.5 million negative impact from lower selling prices which more
than offset the benefit of higher shipping volumes.
Fourth-quarter 2015 operating income increased 4.5 percent
compared to the same quarter a year ago as lower raw material and
energy costs of $2.2 million more than offset the adverse impact of
lower selling prices, downtime for incremental capacity expansion
projects, other inflationary costs and a one-time benefit in the
fourth quarter of 2014. Currency translation favorably impacted
operating income by $0.8 million.
Specialty Papers
Three months ended
December 31 Dollars in thousands
2015
2014 Change
Tons shipped
208,583 201,552 7,031 3.5% Net sales
$219,427 $223,014 $(3,587) (1.6)% Energy and related sales,
net
1,727 1,015 712 70.2% Operating income
15,921
15,618 303 1.9% Operating margin
7.3% 7.0%
Specialty Papers’ net sales declined $3.6 million, or 1.6
percent, due to lower selling prices which negatively impacted the
comparison by $4.9 million, of which $0.9 million was due to
unfavorable currency impacts. Shipping volumes were up 3.5 percent,
outperforming the broader uncoated free-sheet market for the
quarter and for the eleventh consecutive year.
Operating income increased slightly in the year over year
comparison as lower raw material and energy costs of $5.5 million
and higher energy related sales were partially offset by the
adverse impact of lower selling prices.
Other Financial Information
Pension expense totaled $2.5 million and $1.6 million for the
fourth quarters of 2015 and 2014, respectively. For 2016, the
Company expects full year pension expense to be approximately $4.6
million compared to $9.1 million for all of 2015. Because the
Company’s qualified plan remains overfunded, a cash contribution
was not required to be made in 2015 nor is a contribution expected
in the foreseeable future.
During 2015, the Company reduced its workforce by approximately
3 percent in connection with the global workforce efficiency and
cost reduction program initiated earlier in the year. In connection
with these actions, the Company recorded charges totaling, on a
pre-tax basis, $2.5 million for severance and related costs, of
which $0.2 million was recorded in the fourth quarter of 2015.
The Company sold 14,230 acres of timberlands during the fourth
quarter of 2015 for $22.0 million and realized an after-tax gain of
$11.6 million.
In the 2015 fourth quarter, the Company recorded an income tax
provision of $3.4 million on adjusted pre-tax earnings, an
effective tax rate of 12.8 percent. In the comparable quarter a
year ago, the income tax provision totaled $4.7 million and the
effective tax rate was 19.3 percent. The lower tax rate in the 2015
fourth quarter reflects the timing of recognizing certain tax
credits and related adjustments and the impact of a greater
proportion of earnings generated in lower tax foreign jurisdictions
relative to the U.S.
2015 Full Year Results
Net income for 2015 totaled $64.6 million, or $1.47 per diluted
share, compared with $69.2 million, or $1.57 per diluted share, in
2014. Adjusted earnings totaled $58.9 million, or $1.34 per diluted
share, compared with $68.5 million, or $1.55 per diluted share, in
2014. The following table sets forth a reconciliation of results
determined on a GAAP basis to adjusted earnings, a non-GAAP
measure:
Year ended December 31
2015
2014 In thousands, except per share
After taxamounts
Diluted EPS
After taxamounts
Diluted EPS
Net income
$64,575 $1.47 $69,246 $1.57
Timberland sales and related costs
(14,652) (0.33)
(2,995) (0.07)
Fox River environmental matter
6,222 0.14 - - Workforce efficiency charges
1,768 0.04 373 - Asset impairment charge
857
0.02 2,356 0.05 Acquisition and integration related costs
126 - 603 0.01
AMBU capacity expansion costs
30 - - -
Alternative fuel mixture/Cellulosic
biofuel credits
- - (1,115)
(0.03) Adjusted earnings
$58,926
$1.34 $68,468
$1.55
The sum of individual per share amounts set forth above may not
agree to adjusted earnings per share due to rounding.
Consolidated net sales for year ended December 31, 2015 were
$1,661.1 million compared with $1,802.4 million for 2014. On a
constant currency basis, net sales declined $40.3 million, or 2.2
percent. Shipping volumes declined less than one percent.
Balance Sheet and Other Information
Cash and cash equivalents totaled $105.3 million as of December
31, 2015, and net debt was $258.6 million compared with $304.8
million at the end of 2014. (Refer to the calculation of this
measure provided in the tables at the end of this release.)
Capital expenditures totaled $99.9 million in 2015 compared with
$66.0 million in 2014 including $26.9 million and $6.1 million,
respectively, related to environmental compliance projects. For
2016, total capital expenditures are estimated at $150 million to
$170 million, including approximately $40 million to $45 million
related to Specialty Papers’ environmental compliance projects and
$40 million to $45 million for Advanced Airlaid Materials’ new
airlaid facility.
Adjusted free cash flow for the fourth quarter of 2015 was $42.7
million compared with $61.0 million in the same quarter of 2014.
For the full year of 2015, adjusted free cash flow totaled $53.9
million compared with $38.2 million in 2014 primarily due to the
improved use of working capital. (Refer to the calculation of these
measures provided in this release.)
Outlook
In the first quarter of 2016, Composite Fibers’ shipping
volumes, selling prices and raw material and energy prices are
expected to be in-line with the fourth quarter. Maintenance costs
are expected to be approximately $1 million higher compared with
the fourth quarter of 2015 and no benefit from currency hedging is
expected in the first quarter of 2016.
Shipping volumes for Advanced Airlaid Materials in the first
quarter of 2016 are expected to be similar to the fourth quarter.
Average raw material prices and selling prices are expected to be
in-line with the fourth quarter.
For Specialty Papers, the Company expects shipping volumes in
the first quarter of 2016 to be approximately 5 percent lower than
the fourth quarter of 2015. Selling prices are expected to be
slightly lower and input costs are expected to be similar compared
to the fourth quarter.
The normalized tax rate for 2016 is expected to be approximately
24 percent.
Conference Call
As previously announced, the Company will hold a conference call
at 11:00 a.m. (Eastern) today to discuss its fourth-quarter
results. The Company’s earnings release and an accompanying
financial supplement, which includes significant financial
information to be discussed on the conference call, will be
available on Glatfelter’s Investor Relations website at the address
indicated below. Information related to the conference call is as
follows:
What:
Glatfelter’s 4th Quarter 2015 Earnings
Release Conference Call
When: Tuesday, February 9, 2016, 11:00 a.m. (ET)
Number: US dial 888.335.5539 International dial 973.582.2857
Conference ID: 35576064 Webcast:
http://www.glatfelter.com/about_us/investor_relations/default.aspx
Rebroadcast Dates: February 9, 2016 through February 23,
2016 Rebroadcast Number: Within US dial 855.859.2056
International dial 404.537.3406 Conference ID: 35576064
Interested persons who wish to hear the live webcast should go
to the website prior to the starting time to register, download and
install any necessary audio software.
Caution Concerning Forward-Looking Statements
Any statements included in this press release which pertain to
future financial and business matters are “forward-looking
statements” within the meaning of the safe harbor provisions of the
United States Private Securities Litigation Reform Act of 1995. The
Company uses words such as “anticipates”, “believes”, “expects”,
“future”, “intends”, “plans”, and similar expressions to identify
forward-looking statements. Any such statements are based on the
Company’s current expectations and are subject to numerous risks,
uncertainties and other unpredictable or uncontrollable factors
that could cause future results to differ materially from those
expressed in the forward-looking statements including, but not
limited to: changes in industry, business, market, political and
economic conditions in the U.S. and other countries in which the
Company does business, demand for or pricing of its products,
changes in tax legislation, governmental laws, regulations and
policies, initiatives of regulatory authorities, technological
changes and innovations, and market growth rates. In light of these
risks, uncertainties and other factors, the forward-looking matters
discussed in this press release may not occur and readers are
cautioned not to place undue reliance on these forward-looking
statements. The forward-looking statements speak only as of the
date of this press release and Glatfelter undertakes no obligation,
and does not intend, to update these forward-looking statements to
reflect events or circumstances occurring after the date of this
press release. More information about these factors is contained in
Glatfelter’s filings with the U.S. Securities and Exchange
Commission, which are available at www.glatfelter.com.
About Glatfelter
Glatfelter is a global supplier of specialty papers and
fiber-based engineered materials, offering innovation, world-class
service and over a century and a half of technical expertise.
Headquartered in York, PA, the company serves customers in over 100
countries. U.S. operations include facilities in Pennsylvania and
Ohio. International operations include facilities in Canada,
Germany, France, the United Kingdom and the Philippines, and sales
and distribution offices in China and Russia. Glatfelter’s sales
approximate $1.7 billion annually and its common stock is traded on
the New York Stock Exchange under the ticker symbol GLT. Additional
information may be found at www.glatfelter.com.
P. H. Glatfelter Company and
subsidiaries Consolidated Statements of Income
(unaudited)
Three months endedDecember 31
Year endedDecember 31
In thousands, except per share
2015
2014
2015 2014
Net sales
$412,852 $436,261
$1,661,084
$1,802,415 Energy and related sales, net
1,728
1,015
5,664 7,927 Total revenues
414,580 437,276
1,666,748 1,810,342 Costs of products
sold
356,464 379,112
1,463,783
1,575,188 Gross profit
58,116 58,164
202,965
235,154 Selling, general and administrative expenses
27,505 29,484
127,706 133,235
Gains on dispositions of plant, equipment
and timberlands, net
(18,225) (980)
(21,113)
(4,861) Operating income
48,836 29,660
96,372 106,780
Non-operating income (expense) Interest expense
(4,287)
(4,676)
(17,464) (18,921) Interest income
51 16
283 159 Other, net
(423) (740)
(615) (635) Total other expense
(4,659)
(5,400)
(17,796) (19,397) Income
before income taxes
44,177 24,260
78,576 87,383
Income tax provision
9,879 4,703
14,001
18,137 Net income
$34,298
$19,557
$64,575 $69,246
Earnings per
share Basic
$0.79 $0.45
$1.49 $1.60 Diluted
0.78 0.45
1.47 1.57
Cash dividends declared per common
share
$0.12 $0.11
$0.48 $0.44
Weighted average
shares outstanding Basic
43,499 43,107
43,397
43,201 Diluted
43,878 43,943
43,942 44,066
Business Unit Financial Information
(unaudited)
Three months ended December 31
Dollars in millions
Composite Fibers Advanced Airlaid
Materials Specialty Papers Other and
Unallocated Total
2015 2014
2015 2014
2015 2014
2015
2014
2015 2014 Net sales
$131.8 $147.8
$61.6 $65.5
$219.4 $223.0
$- $-
$412.9 $436.3 Energy and related sales, net
-
-
- -
1.7 1.0
- -
1.7 1.0 Total revenue
131.8 147.8
61.6 65.5
221.1 224.0
- -
414.6 437.3 Costs of products sold
104.6
121.3
53.8 57.7
196.1 197.5
2.0
2.6
356.5 379.1
Gross profit (loss)
27.2 26.5
7.8 7.8
25.0
26.5
(2.0) (2.6)
58.1 58.2 SG&A
11.3 12.9
1.8 2.0
9.1 10.9
5.4 3.7
27.5 29.5
Gains on dispositions of plant,equipment
and timberlands, net
- -
- -
- -
(18.2)
(1.0)
(18.2) (1.0)
Total operating income (loss)
15.9 13.5
6.0 5.8
15.9 15.6
10.8 (5.3)
48.8 29.7 Non operating
expense
- -
-
-
- -
(4.7) (5.4)
(4.7)
(5.4) Income (loss) before income taxes
$15.9
$13.5
$6.0 $5.8
$15.9 $15.6
$6.1
$(10.7)
$44.2
$24.3
Supplementary Data Net tons sold (thousands)
37.6 37.8
24.5 23.6
208.6 201.6
- -
270.7 263.0 Depreciation, depletion and amortization
$6.1 $7.0
$2.4 $2.2
$6.7 $7.2
$0.6 $0.6
$15.8 $17.0 Capital expenditures
9.5
7.2
3.2 3.5
12.5 7.6
0.4
0.7
25.6 19.0
Year ended December 31
Dollars in millions
Composite Fibers Advanced Airlaid
Materials Specialty Papers Other and
Unallocated Total
2015 2014
2015 2014
2015 2014
2015
2014
2015 2014 Net sales
$541.5 $617.9
$244.6 $281.7
$875.0 $902.9
$- $-
$1,661.1 $1,802.4 Energy and related sales, net
- -
- -
5.7 7.9
-
-
5.7 7.9 Total
revenue
541.5 617.9
244.6 281.7
880.7 910.8
- -
1,666.7 1,810.3 Costs of products sold
434.4 498.0
215.7
247.6
804.5 821.8
9.2 7.8
1,463.8
1,575.2 Gross profit (loss)
107.1 119.9
28.9 34.1
76.2 89.0
(9.2) (7.8)
203.0
235.2 SG&A
45.7 51.6
7.6 8.8
43.3 50.4
31.0 22.4
127.7 133.2
Gains on dispositions of plant,equipment
and timberlands, net
- -
- -
- -
(21.1)
(4.9)
(21.1) (4.9)
Total operating income (loss)
61.4 68.3
21.3 25.3
32.9 38.6
(19.1) (25.3)
96.4 106.8 Non
operating expense
- -
-
-
- -
(17.8) (19.4)
(17.8) (19.4) Income (loss) before income
taxes
$61.4 $68.3
$21.3
$25.3
$32.9 $38.6
$(36.9) $(44.7)
$78.6 $87.4
Supplementary Data
Net tons sold (thousands)
153.8 157.3
96.0 99.7
802.2 802.9
- -
1,051.9 1,059.9 Depreciation,
depletion and amortization
$26.2 $29.7
$8.8 $9.1
$26.0 $29.9
$2.2 $1.9
$63.2 $70.6 Capital
expenditures
26.8 23.9
7.8 7.6
63.5
32.1
1.8 2.4
99.9 66.0
The sum of individual amounts set forth above may not agree to
the consolidated financial statements included herein due to
rounding.
Selected Financial Information
(unaudited) Year ended December 31 In
thousands
2015
2014
Cash Flow Data Cash provided
(used) by: Operating activities
$133,743 $99,577 Investing
activities
(77,254) (69,589) Financing activities
(48,016) (50,881) Depreciation, depletion and
amortization
63,236 70,555 Capital expenditures
99,889 66,046
December 31 2015
2014
Balance Sheet Data Cash and cash
equivalents
$105,304 $99,837 Total assets
1,503,624
1,561,504 Total debt
363,870 404,612 Shareholders’ equity
663,247 649,109
Reconciliation of GAAP Financial Information to Non-GAAP
Financial Information
This press release includes a discussion of earnings before the
effects of certain specifically identified items, which is referred
to as adjusted earnings, a non-GAAP measure. The Company uses
non-GAAP adjusted earnings to supplement the understanding of its
consolidated financial statements presented in accordance with
GAAP. Non-GAAP adjusted earnings is meant to present the financial
performance of the Company’s core operations, which consists of the
production and sale of specialty papers, composite fibers papers
and airlaid non-woven materials. Management and the Company’s Board
of Directors use non-GAAP adjusted earnings to evaluate the
performance of the Company’s fundamental business in relation to
prior periods. The performance of the Company’s operations is
evaluated based upon numerous items such as tons sold, average
selling prices, gross margins and overhead, among others. Gains on
the sale of timberlands, acquisition and integration related costs,
AMBU capacity expansion costs and impairment and workforce
efficiency charges, among others, are excluded from the Company’s
calculation of non-GAAP adjusted earnings because management
believes each of these items is unique and not part of the
Company’s core business, and will only impact the Company’s
financial results for a limited period of time. Gains from
timberland sales are distinct from revenues generated from product
sales. Unlike items such as cost of raw materials and overhead
costs, acquisition and integration related costs, and impairment
and workforce efficiency charges, are unique items that do not
represent direct costs incurred in the manufacture and sale of the
Company’s products.
Unlike net income determined in accordance with GAAP, non-GAAP
adjusted earnings does not reflect all charges and gains recorded
by the Company for the applicable period and, therefore, does not
present a complete picture of the Company’s results of operations
for the respective period. However, non-GAAP adjusted earnings
provides a measure of how the Company’s core operations are
performing, which management believes is useful to investors
because it allows comparison of such operations from period to
period. Non-GAAP adjusted earnings should not be considered in
isolation from, or as a substitute for, measures of financial
performance prepared in accordance with GAAP.
Calculation of
Adjusted Free Cash Flow Three months ended
December 31
Year ended December 31 In thousands
2015 2014
2015 2014
Cash from operations
$63,220 $78,197
$133,743 $99,577 Less: Capital expenditures
(25,609)
(19,010)
(99,889) (66,046) Add back: Environmental
compliance projects
7,885 3,224
26,873 6,131 Exclude:
Cellulosic biofuel/Alternative fuel mixture credits
(2,751)
(1,425)
(6,816)
(1,425) Adjusted free cash flow
$42,745
$60,986
$53,911
$38,237
Net Debt
December 31 In thousands
2015
2014 Current portion of long-term debt
$7,366
$5,734 Long term debt
356,504 398,878
Total
363,870 404,612 Less: Cash
(105,304)
(99,837) Net Debt
$258,566
$304,775
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160209005843/en/
GlatfelterInvestors:John P. Jacunski,
717-225-2794orMedia:William T. Yanavitch, 717-225-2747
Glatfelter (NYSE:GLT)
Historical Stock Chart
From Mar 2024 to Apr 2024
Glatfelter (NYSE:GLT)
Historical Stock Chart
From Apr 2023 to Apr 2024