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Revenue Growth in All Segments Boost BWAY

Stocks in this article: BWY

Once these most recent quarterly results are finalized, they will be run through Ratings' model and our ratings will be adjusted accordingly. To keep up to date on all of our ratings, visit Ratings Screener.

BWAY Holdings' (BWY) net revenue surged 12.3%, driven by revenue growth across business segments. Net revenue for Q4 FY08 was $284.03 million compared to $254.84 million a year ago. Segment-wise, Metal Packaging net sales improved 7.2% to $161.54 million from $150.74 million in Q4 FY07, attributable to increased pricing. Plastic packaging segment net sales increased 20.0% year-over-year to $122.49 million from $102.08 million a year ago, driven by higher selling prices and increases in volume due to gain in market share. Metal Packaging volume was down 3.0% compared to the same period last year hurt by weaker demand. Plastic Packaging recorded a volume growth of 1.9% as a result of increased market share, driven by the sales of twin-shot pail and continued benefits from company wide cross-selling efforts.

BWY's gross margin expanded 83 basis points to 13.10% from 12.27% a year ago. Cost of products sold ascended 11.3% to $246.82 million from $221.82 million in the year-ago quarter. Selling and administrative expenses mounted 26.4% to $6.65 million from $5.26 million, due to higher bonus expense and a bad debt write-off, offset by lower stock-based compensation and spending. However, operating margin expanded 79 basis points to 6.52% from 5.73% in Q4 FY07. The interest expenses for the last quarter of FY08 plunged 14.5% to $8.23 million from $9.63 million improving the interest coverage ratio to 2.25 from 1.50. Finally, the company's swung to a net income of $6.57 million or $0.28 per share during Q4 FY08 from a net loss of $1.39 million or $0.06 per share in the last year's quarter.

During the quarter under review, cash and cash equivalents jumped 72.4% to $92.10 million from $53.42 million a year ago, while net operating cash flows increased 24.9% during the quarter to $66.08 million. A quick ratio of 0.94 reflects the company's inability to meet its short-term liquidity requirements. Total debt inched down marginally to $421.70 million from $425.84 million; whereas, shareholders equity grew 10.5% to $173.70 million from $157.26 million in Q4 FY07. As a result, the debt-to-equity ratio improved to 2.43 from 2.71. Meanwhile, BWY's return on assets stood at 1.35%, while return on equity was at 6.85%.

For FY08, BWY's net sales augmented 6.3% to $1.02 billion from $959.00 million, due to higher sales prices driven by higher raw material costs. Moreover, the company reported a net income of $11.90 million or $0.51 per share from a net loss of $3.10 million or $0.15 per share in FY07. In addition, the company incurred restructuring and impairment charges of $3.99 million for Q4 FY09 and $9.60 million for the FY08 in conjunction with the closure of a metal -packaging segment facility in Franklin Park, Illinois and a plastic packaging segment facility in Cleveland, Ohio.

Looking forward to Q1 FY09, BWY expects to report a non-GAAP loss to range between $0.12 and $0.16 per share. For fiscal 2009, the company expects its non-GAAP earnings to be in the range of $0.85 to $0.90 per share.

A detailed report covering this quarterly release is now available. To purchase the report, click here .

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