Segment operating profit for the second quarter of 2012 was $96.3 million, or 8.2 percent of net sales, compared to $116.3 million, or 9.5 percent of net sales, for the same period of 2011. Facility consolidation program and acquisition-related integration costs negatively impacted results during the second quarter of 2012. Excluding these costs, segment operating profit, as adjusted, would have been $117.7 million, or 10.1 percent of net sales. (See attached schedule: “Reconciliation of Non-GAAP Data.”) The effect of currency translation decreased operating profit in the second quarter of 2012 by $4.2 million compared to the same quarter of 2011. Performance for the quarter reflects the benefits of prudent cost management and improvements in price/mix, partially offset by the negative impact of lower unit sales volumes.
Commenting on the flexible packaging segment results, Theisen said, “Performance in the second quarter was as expected, with the negative effects of soft volume levels more than offset by increased pricing and improved sales mix. We enjoyed modest volume growth in our high barrier food and medical product applications, but overall volume levels declined due to generally lower sales volumes in less complex product areas. Our facility consolidation program aims to reduce costs and support our focus on high value-added packaging.”
PRESSURE SENSITIVE MATERIALS BUSINESS SEGMENT
Pressure sensitive materials net sales for the second quarter of 2012 were $141.9 million, down 6.3 percent compared to $151.5 million in the second quarter of 2011. The decrease in net sales reflects the impact of lower sales volumes in addition to a negative impact from currency translation of 5.0 percent. Currency translation in this business segment is primarily related to the Euro. For the second quarter of 2012, operating profit was $10.9 million, or 7.7 percent of net sales, compared to operating profit for the second quarter of 2011 of $11.8 million, or 7.8 percent of net sales. The effect of currency translation decreased operating profit in the second quarter of 2012 by $0.8 million compared to the same quarter of 2011.