Berry Plastics Group, Inc. Reports Fourth Quarter And Fiscal Year 2016 Results

Berry Plastics Group, Inc. (NYSE:BERY) today reported results for its fourth fiscal 2016 quarter, referred to in the following as the September 2016 quarter, and fiscal year 2016.

Highlights
  • Reported net sales of $1,618 million for the September 2016 quarter and record fiscal 2016 net sales of $6,489 million
  • Recorded operating income of $151 million in the September 2016 quarter, an increase of 41 percent compared to the prior year quarter
  • Recorded net income of $77 million or $0.61 per diluted share and increased adjusted net income per diluted share by 46 percent in the quarter to $0.73
  • Posted operating EBITDA of $301 million (18.6 percent of net sales) in the September 2016 quarter compared to $205 million (17.1 percent of net sales) in the prior year quarter
  • Generated $290 million of cash flow from operations in the September 2016 quarter compared to $245 million in the prior year quarter
  • Increased adjusted free cash flow by 22 percent to $231 million in the September 2016 quarter resulting in a record of $517 million for fiscal year 2016
  • Exceeded fiscal year 2016 guidance for both operating EBITDA and adjusted free cash flow
  • Expected fiscal year 2017 cash flow from operations of $925 million and adjusted free cash flow of $550 million

"Berry had a strong fourth fiscal quarter and full year as we exceeded our guidance for both free cash flow and operating EBITDA. We generated solid adjusted free cash flow of $231 million in the quarter, bringing our adjusted free cash flow for the 2016 fiscal year to a record $517 million," said Tom Salmon, President and COO of Berry Plastics.

September 2016 Quarter Results

For the September 2016 quarter, the Company recorded net sales of $1,618 million compared to $1,196 million in the same prior year period. The year-over-year increase was primarily attributed to net sales from the acquisition of AVINTIV, Inc. ("Avintiv"). Net sales by reportable segment are presented in the following table.
 
Quarterly Period Ended (Unaudited)
Net sales (in millions of dollars) October 1, 2016   September 26, 2015  

$ Change
    % Change  
Consumer Packaging $ 693   $ 707   $ (14 )   (2

)%

Health, Hygiene, & Specialties
560 119 441 371 %
Engineered Materials 365   370   (5 )   (1

)%
Total net sales $1,618   $1,196   $422     35

%
 

For the September 2016 quarter, the Company had operating income of $151 million compared to $107 million in the same prior year quarter. The 41 percent year-over-year increase was primarily attributed to the acquisition of Avintiv, a $22 million improvement in our product mix and price/cost spread including contributions from sourcing synergies, a $12 million decrease in selling, general, and administrative expenses, and a $9 million reduction in restructuring and business integration expenses. These positive contributions were partially offset by a $16 million increase in depreciation and amortization expense, and a $6 million negative impact from currency translation.

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