AptarGroup, Inc. (NYSE:ATR) today reported record quarterly revenues and first quarter earnings per share.

First Quarter 2014 Summary

  • Reported sales (and core sales excluding currency effects) rose 9% to $676 million
  • Core sales excluding currency effects increased in each business segment, market and geographic region
  • Reported earnings per share rose 11% to $0.71 compared to $0.64 in the prior year excluding charges related to the European restructuring plan ($0.05 per share) in 2013
  • A higher effective tax rate reduced earnings per share by approximately $0.03 compared to the prior year when excluding the impact of the European restructuring plan in 2013

FIRST QUARTER RESULTS

For the quarter ended March 31, 2014, reported sales increased 9% to $676 million from $618 million a year ago. Changes in currency exchange rates did not have a significant impact on the sales growth.

First Quarter Segment Sales Analysis

(Change Over Prior Year)

 

Beauty +
Home

  Pharma  

Food +
Beverage

 

Total
AptarGroup

Product Sales (including tooling) 9%   12%   5%   9%
Currency Effects -1%   3%   1%   0%
Total Reported Growth 8%   15%   6%   9%

Commenting on the quarter, Stephen Hagge, President and CEO, said, “We are pleased to report an excellent first quarter with balanced core sales growth across each segment, market and geographic region. Our Pharma segment had another outstanding performance with particularly strong demand from the consumer health care and prescription drug markets. It was also encouraging to see the rise in sales at our Beauty + Home segment driven by increased demand from the beauty and personal care markets. Our Food + Beverage segment’s sales also increased despite custom tooling sales declining compared to the prior year.”

Hagge continued, “The broad-based increases in sales drove our earnings to a record first quarter level. This was in spite of certain headwinds that included negative currency effects and facility start-up costs primarily related to our Beauty + Home segment’s Latin American operations, and a higher effective tax rate.”

DIVIDEND

As previously announced, on April 11, 2014, the Board of Directors increased the quarterly cash dividend by 12% to $0.28 per share. The payment date is May 21, 2014, to stockholders of record as of April 30, 2014. Hagge commented on the increase, “This increase is reflective of our strong financial condition and confidence in the future. 2014 will be our twenty first consecutive year of increased dividends. Our balanced capital allocation strategy allows for increased dividends, share repurchases and investments that will contribute to future growth.”

OUTLOOK

Regarding the Company’s outlook, Hagge stated, “I am encouraged by the current level of project discussions with customers who are seeking innovative packaging solutions to help grow their businesses. I am optimistic that we will see some of these new projects coming to market over the next twelve months. Looking to the second quarter, we expect broad-based demand for our innovative dispensing solutions to continue across each of our business segments and drive growth over the prior year. In the near-term, the emerging market currency environments are expected to remain challenging and we don’t anticipate the impact from resin pricing adjustments to be as favorable as it was in the prior year. We expect second quarter earnings per share to be in the range of $0.78 to $0.83 compared to $0.77 per share a year ago excluding the charges related to our European restructuring plan.”

OPEN CONFERENCE CALL

There will be a conference call on Friday, April 25, 2014 at 8:00 a.m. Central Time to discuss AptarGroup’s first quarter results for 2014. 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 solutions for the beauty, personal care, home care, prescription drug, consumer health care, injectables, 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; financial conditions of customers and suppliers; consolidations within our customer or supplier bases; fluctuations in the cost of raw materials, components and other input costs; the Company’s ability to increase prices, contain costs and improve productivity; changes in capital availability or cost, including interest rate fluctuations; the competitive marketplace; fiscal and monetary policies and other regulations; inflationary pressures and 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
March 31,

2014

2013

 
Net Sales $ 676,051 $ 617,633
Cost of Sales (exclusive of depreciation
shown below) 453,411 418,486
Selling, Research & Development and
Administrative 106,674 94,307
Depreciation and Amortization (1) 37,247 36,171
Restructuring Initiatives   -     4,067  
Operating Income 78,719 64,602
Other Income/(Expense):
Interest Expense (4,881 ) (5,081 )
Interest Income 1,016 849
Equity in income of affiliates (1,546 ) (262 )
Miscellaneous, net   372     (706 )
Income before Income Taxes 73,680 59,402
Provision for Income Taxes   25,272     19,424  
Net Income $ 48,408 $ 39,978
 
Net (Income)/Loss Attributable to Noncontrolling Interests   (19 )   51  
Net Income Attributable to AptarGroup, Inc. $ 48,389   $ 40,029  
Net Income Attributable to AptarGroup, Inc. Per Common Share:
Basic $ 0.74   $ 0.61  
Diluted $ 0.71   $ 0.59  
 
Average Numbers of Shares Outstanding:
Basic 65,468 66,155
Diluted 68,232 68,296

Notes to Condensed Consolidated Financial Statements:

(1) Depreciation and Amortization for the quarter ended March 31, 2013 included approximately $0.5 million of accelerated depreciation related to the European restructuring plan.

APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
CONSOLIDATED BALANCE SHEETS
   
March 31, 2014 December 31, 2013
ASSETS
 
Cash and Equivalents $ 317,177 $ 309,861
Receivables, net 505,505 438,221
Inventories 358,709 353,159
Other Current Assets   97,651   97,170
Total Current Assets 1,279,042 1,198,411
Net Property, Plant and Equipment 870,051 864,662
Goodwill, net 359,681 358,865
Other Assets   71,659   75,824
Total Assets $ 2,580,433 $ 2,497,762
 
LIABILITIES AND EQUITY
 
Short-Term Obligations $ 174,288 $ 139,770
Accounts Payable and Accrued Liabilities   411,506   403,051
Total Current Liabilities 585,794 542,821
Long-Term Obligations 354,758 354,814
Deferred Liabilities   120,995   119,819
Total Liabilities 1,061,547 1,017,454
 
AptarGroup, Inc. Stockholders' Equity 1,518,326 1,479,757
Noncontrolling Interests in Subsidiaries   560   551
Total Equity   1,518,886   1,480,308
 
Total Liabilities and Equity $ 2,580,433 $ 2,497,762

APTARGROUP, INC.
Condensed Consolidated Financial Statements (Unaudited)
(continued)
(In Thousands)
SEGMENT INFORMATION
   
Three Months Ended
March 31,
 
2014 2013

NET SALES

Beauty + Home $ 391,236 $ 363,472
Pharma 194,349 168,869
Food + Beverage   90,466     85,292  
Total Net Sales $ 676,051   $ 617,633  
 

SEGMENT INCOME (1)

Beauty + Home $ 27,781 $ 24,415
Pharma 52,482 45,980
Food + Beverage 9,080 8,550
Restructuring Initiatives & Related Depreciation (2) - (4,526 )
Corporate and Other   (11,798 )   (10,785 )
Total Income Before Interest and Taxes $ 77,545 $ 63,634
Interest Expense, Net   (3,865 )   (4,232 )
Income before Income Taxes $ 73,680   $ 59,402  
 

SEGMENT INCOME AS % OF NET SALES

Beauty + Home 7.1 % 6.7 %
Pharma 27.0 % 27.2 %
Food + Beverage 10.0 % 10.0 %

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) - Restructuring Initiatives & Related Depreciation includes the following expense items:

Depreciation:

   2014   2013
European Restructuring Plan   $ - $ (459 )
 

Restructuring Initiatives:

European Restructuring Plan $ - $ (4,067 )
Total Restructuring Initiatives & Related Depreciation $ - $ (4,526 )