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AptarGroup Achieves Record Quarterly Results; Plans To Increase Capacity For Aptar Stelmi And Also Expand Aptar’s Latin American Presence

EUROPEAN OPERATIONS OPTIMIZATION PLAN UPDATE

Commenting on the previously announced operations optimization plan, Hagge stated, “Our plan is on schedule and progressing well.”

In the second quarter, AptarGroup recognized approximately $3.1 million of expense related to the plan, of which $0.6 million were non-cash expenses. For the year-to-date, AptarGroup recognized approximately $7.6 million of expense related to the plan, of which $1 million were non-cash expenses. Using current exchange rates, AptarGroup expects to recognize approximately $6 million in additional costs, most of which will be incurred in 2013. Savings from the plan are expected to be approximately $12 million on an annualized basis.

OUTLOOK

Commenting on AptarGroup’s outlook, Hagge said, “Looking to the third quarter, we anticipate that each of our business segments will grow over the prior year. Even though we expect challenges in several of the markets we serve, the diversity of our product portfolio, geographic presence, customer base and end markets, protect us from exposure to softness in any particular market or region.”

AptarGroup expects earnings per share for the third quarter, before costs associated with the EOO plan, to be in the range of $0.68 to $0.73 per share compared to $0.62 per share reported in the prior year. Prior year results include a negative impact of $0.02 per share from Aptar Stelmi’s results which included acquisition accounting adjustments.

SHARE REPURCHASE PROGRAM AND CASH DIVIDEND

As previously announced, the Board of Directors increased the number of shares authorized for repurchase by 4 million shares bringing the total currently authorized for repurchase to 5.2 million shares. The Board also declared on July 18, 2013, a quarterly dividend of $0.25 per share, payable August 21, 2013 to shareholders of record as of July 31, 2013.

OPEN CONFERENCE CALL

There will be a conference call on Thursday, July 25, 2013 at 8:00 a.m. Central Time to discuss AptarGroup’s second quarter results for 2013. The call will last approximately one hour. Interested parties are invited to listen to a live webcast by visiting the Investor Relations page at www.aptar.com. Replay of the conference call can also be accessed on the Investor Relations page of the website.

AptarGroup, Inc. is a leading global supplier of a broad range of innovative dispensing systems for the beauty, personal care, home care, pharmaceutical, food, and beverage markets. AptarGroup is headquartered in Crystal Lake, Illinois, with manufacturing facilities in North America, Europe, Asia and South America. For more information, visit www.aptar.com.

This press release contains forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are based on management’s beliefs as well as assumptions made by and information currently available to management. Accordingly, AptarGroup’s actual results may differ materially from those expressed or implied in such forward-looking statements due to known or unknown risks and uncertainties that exist including, but not limited to, economic, environmental or political conditions in the various markets and countries in which AptarGroup operates, changes in customer and/or consumer spending levels including the recent slowdown in Europe; financial conditions of customers and suppliers; fluctuations in the cost of raw materials, components and other input costs; the Company’s ability to increase prices, contain costs and improve productivity; the timing and successful completion of our European operations optimization plan; changes in capital availability or cost, including interest rate fluctuations; the competitive marketplace; fiscal and monetary policy; changes in foreign currency exchange rates; direct or indirect consequences of acts of war or terrorism; and labor relations. For additional information on these and other risks and uncertainties, please see AptarGroup’s filings with the Securities and Exchange Commission, including its Form 10-K’s and Form 10-Q’s. Readers are cautioned not to place undue reliance on forward-looking statements . AptarGroup undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

 
 
 
APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
       
(In Thousands, Except Per Share Data)
CONSOLIDATED STATEMENTS OF INCOME
 
Three Months Ended Six Months Ended
June 30,   June 30,

2013

2012

2013

2012

 
Net Sales $ 641,441 $ 577,503 $ 1,259,074 $ 1,170,001

Cost of Sales (exclusive of depreciation shown below)

431,351 390,225 849,837 791,295

Selling, Research & Development and Administrative

88,111 87,840 182,418 176,339
Depreciation and Other Amortization (1) 38,614 32,597 74,785 65,151
Restructuring Initiatives   2,511     (215 )   6,578     (215 )
Operating Income 80,854 67,056 145,456 137,431
Other Income/(Expense):
Interest Expense (5,442 ) (3,904 ) (10,523 ) (9,146 )
Interest Income 846 794 1,695 1,822
Equity in results of affiliates (61 ) (158 ) (323 ) (289 )
Miscellaneous, net   73     (1,247 )   (633 )   (1,000 )
Income before Income Taxes 76,270 62,541 135,672 128,818
Provision for Income Taxes   26,390     20,889     45,814     43,353  
Net Income $ 49,880 $ 41,652 $ 89,858 $ 85,465
 
Net (Gain)/Loss Attributable to Noncontrolling Interests   (78 )   34     (27 )   30  
Net Income Attributable to AptarGroup, Inc. $ 49,802   $ 41,686   $ 89,831   $ 85,495  
Net Income Attributable to AptarGroup, Inc. Per Common Share:
Basic $ 0.75   $ 0.63   $ 1.36   $ 1.29  
Diluted $ 0.73   $ 0.61   $ 1.31   $ 1.24  
 
Average Numbers of Shares Outstanding:
Basic 66,420 66,580 66,288 66,388
Diluted 68,106 68,758 68,339 68,940
 
(1) Depreciation and Amortization for the quarter and year-to-date ended June 30, 2013 included approximately $0.6 million and $1 million, respectively, of accelerated depreciation related to the European Operations Optimization plan.
 
 
 

APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
CONSOLIDATED BALANCE SHEETS
   
June 30, 2013 December 31, 2012
ASSETS
 
Cash and Equivalents $ 189,990 $ 229,755
Receivables, net 455,935 396,788
Inventories 337,625 321,885
Other Current Assets   101,070   90,505
Total Current Assets 1,084,620 1,038,933
Net Property, Plant and Equipment 836,708 848,233
Goodwill, net 346,730 351,552
Other Assets   71,323   85,694
Total Assets $ 2,339,381 $ 2,324,412
 
LIABILITIES AND EQUITY
 
Short-Term Obligations $ 35,277 $ 74,654
Accounts Payable and Accrued Liabilities   404,001   380,669
Total Current Liabilities 439,278 455,323
Long-Term Obligations 352,636 352,860
Deferred Liabilities   136,805   135,731
Total Liabilities 928,719 943,914
 
AptarGroup, Inc. Stockholders' Equity 1,410,022 1,379,890
Noncontrolling Interests in Subsidiaries   640   608
Total Equity   1,410,662   1,380,498
 
Total Liabilities and Equity $ 2,339,381 $ 2,324,412
 
 
 

APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
SEGMENT INFORMATION
           
Three Months Ended Six Months Ended
June 30,       June 30,
 

2013

2012

2013

2012

NET SALES

Beauty + Home $ 374,984 $ 369,284 $ 738,456 $ 746,435
Pharma 182,931 132,979 351,800 273,022
Food + Beverage   83,526     75,240     168,818     150,544  
Total Net Sales $ 641,441   $ 577,503   $ 1,259,074   $ 1,170,001  

 

SEGMENT INCOME (1)

Beauty + Home $ 30,339 $ 33,546 $ 54,754 $ 66,518
Pharma (2) 50,437 31,110 96,417 70,482
Food + Beverage 11,864 7,744 20,414 14,532
Restructuring Initiatives & Related Depreciation (3) (3,067 ) 215 (7,593 ) 215
Corporate and Other   (8,707 )   (6,964 )   (19,492 )   (15,605 )
Total Income Before Interest and Taxes $ 80,866 $ 65,651 $ 144,500 $ 136,142
Interest Expense, Net   (4,596 )   (3,110 )   (8,828 )   (7,324 )
Income before Income Taxes $ 76,270   $ 62,541   $ 135,672   $ 128,818  
 

SEGMENT INCOME AS % OF NET SALES

Beauty + Home 8.1 % 9.1 % 7.4 % 8.9 %
Pharma (2) 27.6 % 23.4 % 27.4 % 25.8 %
Food + Beverage 14.2 % 10.3 % 12.1 % 9.7 %
 
 
Notes to Condensed Consolidated Financial Statements:
(1) - The Company evaluates performance of its business units and allocates resources based upon segment income defined as earnings before net interest expense, certain corporate expenses, restructuring initiatives and income taxes.
 
(2) - Pharma segment income as a percent of net sales was approximately 29.7% for the second quarter of 2013 and 29.5% for the year-to-date 2013 excluding the effects of the Aptar Stelmi acquisition. Pharma segment income as a percent of net sales was approximately 27.5% for the second quarter of 2012 and 28.0% for the year-to-date 2012 excluding the effects of the Aptar Stelmi acquisition.
 
(3) - Restructuring Initiatives & Related Depreciation includes the following income/(expense) items:
 
 
Three Months Ended Six Months Ended
June 30,       June 30,

Depreciation:

2013

2012

2013

2012

European Operations Optimization Plan $ (556 ) $ (1,015 )
 

Restructuring Initiatives:

European Operations Optimization Plan (2,555 ) (6,622 )
Other Initiatives $ 44       215         $ 44       215  
Total Restructuring Initiatives & Related Depreciation $ (3,067 ) $ 215   $ (7,593 ) $ 215  
 
 




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