Schaumburg, Illinois, USA, 15 April 2009 -- /PRNewswire/ -- Pliant Corporation today reported results for its first quarter ended 31 March 2009.
For the first quarter, Pliant reported sales of USD 233 million, EBITDA of USD 19 million, and available liquidity of USD 87 million. These results were in line with management expectations and in line with requirements to achieve its 2009 full year plan. Most of Pliant's business is under contract to retail food, personal care, and medical customers, and the company's core businesses are tied to end-products that are less vulnerable to recessionary factors. Overall sales volume was on plan.
First quarter EBITDA and sales volume recovered and improved sequentially. Compared with the fourth quarter of 2008, sales volumes are up about 10% and EBITDA is up USD 12 million.
Pliant's focus on customer relationships continued to pay off as Pliant increased its percentage of revenue under contract with its top customers. Of the company's top 100 customers in 2005, 99 are still customers of Pliant today.
Pliant is on track to achieve its customer satisfaction objectives, annual sales plan, innovation plans and annual profit plan of USD 74 million of EBITDA.
Pliant's raw material (resin) prices have normalized after the extreme oil/gas volatility of 2008. Although resin price volatility will likely continue, new resin supply coming on-line in the Middle East and China will help moderate price spikes. The company has spent several years preparing its resin handling, production, and inspection equipment; film structures; supply chains; and vendor relationships for this change. These new resin supplies are transforming the world resin supply base from North American-centric to Middle East-centric. The company is in position to take advantage of these changes.
In the first quarter, the company's plant network achieved its cost targets and continued the implementation of several plant consolidations that began in 2008. These consolidations also encompass a strategic repositioning of the production assets housed in those facilities. Film production assets are being upgraded with state-of-the-art technology and capabilities and then relocated to Pliant locations that are lower cost and closer to customers. This will improve service levels, lower supply chain costs, and increase the company's competitiveness. Also in the first quarter, the company's product quality and on-time performance were excellent and on plan.
Debt Reduction and Balance Sheet Restructuring
Pliant's balance sheet restructuring process is on track with expectations. Pliant filed a pre-negotiated plan of restructuring in the first quarter whereby the majority of the company's debt would be converted into equity in a pre-negotiated debt-for-equity swap with the company's first lien secured creditors. This plan was filed with the court and that process is underway and on track with expectations.
Harold Bevis, Pliant's president and chief executive officer, said: "We are very pleased with our first quarter results of USD 233 million in sales and USD 19 million in EBITDA. This clearly shows that our business is recovering in the manner in which we expected. We are at the run rate that we expected in order to achieve our full year sales plan, full year EBITDA plan, and full year liquidity plan. Furthermore, this performance substantiates and underpins the enterprise values stated for the company -- no more, no less."
Pliant Corporation is a leading producer of value-added film and flexible packaging products for personal care, medical, food, industrial, and agricultural markets. The company operates 21 manufacturing and research and development facilities around the world, and employs approximately 2900 people.
Reconciliation of income from continuing operations before
income taxes and EBITDA
3 Months Ended 3 Months Ended
Amounts in USD millions 31 December 2008 31 March 2009
Income (loss) from continuing
operations before income taxes USD(129.7) USD(23.1)
Depreciation and amortization 11.6 11.1
Interest 25.0 21.2
Restructuring and other costs 9.7 1.5
Goodwill and fixed asset impairments 87.4 --
Reorganization and other costs 3.2 8.3
EBITDA (USD) 7.2 19.0