Berry Plastics Group, Inc. (NYSE:BERY) today reported results
for its first fiscal 2015 quarter, referred to in the following as
the December 2014 quarter:
- Increased net sales by 7 percent to
$1,220 million for the December 2014 quarter compared to $1,140
million in the December 2013 quarter
- Recorded net income per diluted share
of $0.11 and adjusted net income per diluted share of $0.27 for the
December 2014 quarter
- Increased Operating EBITDA by 6 percent
to $182 million for the December 2014 quarter compared to $172
million in the December 2013 quarter
- Generated $100 million of cash flow
from operations and adjusted free cash flow of $36 million for the
December 2014 quarter
- Made a voluntary $100 million principal
payment on our term loan in November 2014
"In the December 2014 quarter we reported both record sales and
Operating EBITDA for any December ending quarter in the Company’s
history. Operating EBITDA improved by $10 million or 6 percent over
the same prior year quarter, primarily as a result of improved
operational productivity and cost savings from our previously
announced restructuring activities, along with contributions and
synergies from our recent acquisitions," said Jon Rich, Chairman
and CEO of Berry Plastics.
December 2014 Quarter Results
For the December 2014 quarter, the Company’s net sales increased
by 7 percent to $1,220 million from $1,140 million in the December
2013 quarter. The year-over-year increase was primarily attributed
to net sales from businesses we acquired in the last twelve months
and increased selling prices due to higher material costs and
non-resin related cost inflation partially offset by soft customer
demand.
Quarterly Period Ended (Unaudited)
Net sales
(in millions of dollars)
December 27, 2014
December 28, 2013
$ Change
% Change Rigid Open Top
$ 257 $
261 $ (4 ) (2 )% Rigid Closed Top
373 332 41
12 % Engineered Materials
349 342 7 2 % Flexible Packaging
241 205 36
18 % Total net sales
$ 1,220 $ 1,140 $
80 7 %
Capital Structure and Adjusted Free Cash Flow
The ratio of net debt of $3,759 million at the end of the
December 2014 quarter to adjusted EBITDA of $828 million for the
four quarters ended December 27, 2014, was 4.5x, representing a
0.1x improvement (reduction) in the quarter. The Company’s adjusted
free cash flow for the December 2014 quarter was $36 million and
$244 million for the four quarters ended December 27, 2014.
Reflecting the Company’s commitment to reduce debt and our strong
free cash flow in fiscal 2014 we made a voluntary $100 million
principal payment on our term loan in November 2014.
December 27,2014
September 27,2014
(in millions of dollars) (Unaudited) Term loans
$
2,398 $ 2,505 Revolving line of credit — — 5½% second
priority notes
500 500 9¾% second priority notes
800
800 Capital leases and other
114 113
Total debt
$ 3,812 $ 3,918 Less: cash and cash
equivalents
(53 ) (129 ) Net debt
$ 3,759 $ 3,789
Outlook
Regarding the Company’s outlook, Rich stated, “We will continue
to focus on our four key strategic initiatives including our
primary goal of reducing our overall debt leverage by 0.5x per
year. We are reaffirming our fiscal 2015 adjusted free cash flow
guidance of $320 million assuming no impact from resin cost
changes. This estimate includes $589 million of cash from operating
activities and $230 million of additions to property, plant, and
equipment. Although not factored into our guidance, just as raw
material price increases have negatively impacted our cash flow
from operating activities over the past two years, we expect that
the trend of decreasing resin prices, to the extent it continues,
should have a favorable impact on cash from operating activities
beginning in the March 2015 quarter.”
Investor Conference Call
The Company will host a conference call today, January 30, 2015,
at 10 a.m. Eastern Time to discuss its first quarter fiscal 2015
results. The telephone number to access the conference call is
(866) 244-4530 (domestic), or (703) 639-1173 (international),
conference ID 1650155. The call will last approximately one hour.
Interested parties are invited to listen to a live webcast by
visiting the Company’s Investor Relations page at
www.berryplastics.com. A replay of the conference call can also be
accessed on the Investor Relations page of the website beginning
January 30, 2015, at 2 p.m. Eastern Time, to February 6, 2015, by
calling (888) 266-2081 (domestic), or (703) 925-2533
(international), access code 1650155.
About Berry Plastics
Berry Plastics Group, Inc. is a leading provider of value-added
plastic consumer packaging and engineered materials delivering
high-quality customized solutions to our customers. The Company’s
world headquarters is located in Evansville, Indiana, with annual
net sales of $5 billion in fiscal 2014 and is listed on the New
York Stock Exchange under the ticker symbol BERY. For additional
information, visit the Company’s website at
www.berryplastics.com.
Non-GAAP Financial Measures
This press release includes non-GAAP financial measures such as
Operating EBITDA, Adjusted EBITDA, Adjusted net income per share
and Adjusted free cash flow. A reconciliation of these non-GAAP
financial measures to comparable measures determined in accordance
with accounting principles generally accepted in the United States
of America (GAAP) is set forth at the end of this press
release.
Forward Looking Statements
Statements in this release that are not historical, including
statements relating to the expected future performance of the
Company, are considered “forward looking” and are presented
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. You can identify forward-looking
statements because they contain words such as “believes,”
“expects,” “may,” “will,” “should,” “would,” “could,” “seeks,”
“approximately,” “intends,” “plans,” “estimates,” “anticipates”
“outlook,” or “looking forward,” or similar expressions that relate
to our strategy, plans or intentions. All statements we make
relating to our estimated and projected earnings, margins, costs,
expenditures, cash flows, growth rates and financial results or to
our expectations regarding future industry trends are
forward-looking statements. In addition, we, through our senior
management, from time to time make forward-looking public
statements concerning our expected future operations and
performance and other developments. These forward-looking
statements are subject to risks and uncertainties that may change
at any time, and, therefore, our actual results may differ
materially from those that we expected.
Important factors that could cause actual results to differ
materially from our expectations, which we refer to as cautionary
statements, are disclosed under “Risk Factors” and elsewhere in our
Annual Report on Form 10-K and subsequent filings with the
Securities and Exchange Commission, including, without limitation,
in conjunction with the forward-looking statements included in this
release. All forward-looking information and subsequent written and
oral forward-looking statements attributable to us, or to persons
acting on our behalf, are expressly qualified in their entirety by
the cautionary statements. Some of the factors that we believe
could affect our results include: (1) risks associated with our
substantial indebtedness and debt service; (2) changes in prices
and availability of resin and other raw materials and our ability
to pass on changes in raw material prices on a timely basis; (3)
the impact of potential changes in interest rates: (4) performance
of our business and future operating results; (5) risks related to
our acquisition strategy and integration of acquired businesses;
(6) reliance on unpatented know-how and trade secrets; (7)
increases in the cost of compliance with laws and regulations,
including environmental, safety, and production and product laws
and regulations; (8) risks related to disruptions in the overall
economy and the financial markets may adversely impact our
business; (9) catastrophic loss of one of our key manufacturing
facilities, natural disasters, and other unplanned business
interruptions; (10) risks of competition, including foreign
competition, in our existing and future markets;(11) general
business and economic conditions, particularly an economic
downturn; (12) the ability of our insurance to cover fully our
potential exposures; (13) risks that our restructuring programs may
entail greater implementation costs or result in lower costs
savings than anticipated, and (14) the other factors discussed in
the under the heading “Risk Factors” in our Annual Report on Form
10-K and subsequent filings with the Securities and Exchange
Commission. We caution you that the foregoing list of important
factors may not contain all of the material factors that are
important to you. Accordingly, readers should not place undue
reliance on those statements. All forward-looking statements are
based upon information available to us on the date of this release.
We undertake no obligation to publicly update or revise any
forward-looking statement as a result of new information, future
events or otherwise, except as otherwise required by law.
Berry Plastics Group, Inc. Consolidated Statements
of Income
(Unaudited)
(in millions of dollars, except per share
data)
Quarterly Period Ended
December 27,2014
December 28,2013
Net sales
$ 1,220 $ 1,140 Costs and expenses:
Cost of goods sold
1,037 964 Selling, general and
administrative
86 77 Amortization of intangibles
25
26 Restructuring and impairment charges
4
10 Operating income
68 63 Other income,
net
(1 ) (1 ) Interest expense, net
53
55 Income before income taxes
16 9
Income tax expense
3 3 Net
income
$ 13 $ 6 Net income per share:
Basic
$ 0.11 $ 0.05 Diluted
0.11 0.05
Outstanding weighted-average shares: (in millions) Basic
118.2 115.9 Diluted
122.9 120.5
Berry Plastics Group, Inc. Consolidated Statements of
Comprehensive Income (Loss)
(Unaudited)
(in millions of dollars)
Quarterly Period Ended
December 27,2014
December 28,2013
Net income
$ 13 $ 6 Currency translation
(14
) (1 ) Interest rate hedges
(7 ) — Provision
for income taxes related to other comprehensive income items
2 — Comprehensive income (loss)
$ (6 ) $ 5
Berry Plastics Group, Inc. Condensed Consolidated Balance
Sheets
(in millions of dollars)
December 27,2014
September 27,2014
Assets: (Unaudited) Cash and cash equivalents
$ 53 $
129 Accounts receivable, net
442 491 Inventories
619
604 Other current assets
288 208 Property, plant and
equipment, net
1,331 1,364 Goodwill, intangibles assets and
other long-term assets
2,443 2,472 Total assets
$5,176 $5,268
Liabilities and stockholders'
deficit Current liabilities, excluding debt
686 709
Current and long-term debt
3,812 3,918 Other long-term
liabilities
771 742 Redeemable non-controlling interest
13 13 Stockholders’ deficit
(106) (114) Total
liabilities and stockholders' deficit
$5,176 $5,268
Berry Plastics Group, Inc. Condensed Consolidated
Statements of Cash Flows
(Unaudited)
(in millions of dollars)
Quarterly Period Ended
December 27,2014
December 28,2013
Cash flows from operating activities: Net income
$ 13 $ 6 Depreciation and amortization
91 85
Other non-cash items
12 14 Working capital
(16
) 67 Net cash from operating activities
100 ] 172
Cash flows from investing
activities: Additions to property, plant, and equipment
(35 ) (47 ) Proceeds from sale of assets
10 1
Acquisitions of businesses, net of cash acquired
—
(67 ) Net cash from investing activities
(25
) (113 )
Cash flows from financing activities:
Proceeds from long-term borrowings
— 3 Repayment of
long-term borrowings
(116 ) (13 ) Proceeds from
issuance of common stock
7 3 Payment of tax receivable
agreement
(39 ) (32 ) Net cash from
financing activities
(148 ) (39 )
Effect of exchange rate changes on cash
(3 ) — Net
change in cash and cash equivalents
(76 ) 20 Cash and
cash equivalents at beginning of period
129
142 Cash and cash equivalents at end of period
$ 53 $ 162
Berry
Plastics Group, Inc. Condensed Consolidated Financial
Statements Segment Information
(Unaudited)
(in millions of dollars)
Quarterly Period Ended
December 27,2014
December 28,2013
Net sales: Rigid Open Top
$ 257 $ 261 Rigid
Closed Top
373 332 Engineered Materials
349 342
Flexible Packaging
241 205 Total
$ 1,220 $ 1,140
Operating income
(loss): Rigid Open Top
$ 7 $ 13 Rigid Closed Top
21 30 Engineered Materials
32 25 Flexible Packaging
8 (5 ) Total
$ 68 $ 63
Depreciation and amortization: Rigid Open Top
$
23 $ 23 Rigid Closed Top
36 30 Engineered Materials
17 19 Flexible Packaging
15 13
Total
$ 91 $ 85
Restructuring and
impairment charges: Rigid Open Top
$ — $ 1 Rigid
Closed Top
1 — Engineered Materials
— 3 Flexible
Packaging
3 6 Total
$ 4 $
10
Business optimization and other expense (1)
: Rigid Open Top
$ 7 $ 5 Rigid Closed Top
7 3 Engineered Materials
2 2 Flexible Packaging
3 4 Total
$ 19 $ 14
Operating EBITDA: Rigid Open Top
$ 37 $
42 Rigid Closed Top
65 63 Engineered Materials
51 49
Flexible Packaging
29 18 Total
$
182 $ 172
(1) Includes business optimization and integration
expenses and non-cash charges.
Berry Plastics Group, Inc. Reconciliation
Schedules
(Unaudited)
(in millions of dollars, except per share
data)
Four Quarters Quarterly Period Ended
Ended
December 27,2014
December 28,2013
December 27,2014
Operating income $ 68 $ 63
$ 321 Add: depreciation and amortization
91 85
364 Add: restructuring and impairment
4
10
24 Add: business optimization and other expense
(1) 19 14
85
Operating EBITDA (2) $ 182
$ 172
$ 794 Add: pro forma
acquisitions
— 14 Add: unrealized cost savings
1 20 Adjusted EBITDA
(2) $ 183 $ 828
Cash flow from operating activities
$ 100
$ 458 Net additions to property, plant, and equipment
(25 ) (175 ) Payment of tax receivable
agreement
(39 ) (39 )
Adjusted free cash flow (2) $ 36
$ 244 Net income per diluted share
$ 0.11 Restructuring and impairment (net of tax)
0.02 Non-cash amortization from 2006 private sale (net of
tax)
0.04 Business optimization and other expense
(1)
(net of tax)
0.10 Adjusted net income per
diluted share (2) $ 0.27 (1)
Includes business optimization and integration expenses and
non-cash charges. (2) Supplemental financial measures that
are not required by, or presented in accordance with, accounting
principles generally accepted in the United States (“GAAP”). These
non-GAAP financial measures should not be considered as
alternatives to operating or net income or cash flows from
operating activities, in each case determined in accordance with
GAAP. These non-GAAP financial measures are among the indicators
used by management to measure the performance of the Company’s
operations, and also among the criteria upon which
performance-based compensation may be based. Adjusted EBITDA also
is used by our lenders for debt covenant compliance purposes. We
use Adjusted Free Cash Flow as a measure of liquidity because it
assists us in assessing our company’s ability to fund its growth
through its generation of cash. Our projected Adjusted Free Cash
flow for fiscal 2015 assumes $589 million of cash flow from
operations less $230 million of net additions to property, plant,
and equipment and $39 million of payment under our tax receivable
agreement. Similar non-GAAP financial measures may be
calculated differently by other companies, including other
companies in our industry, limiting their usefulness as comparative
measures. Because of these limitations, you should consider the
non-GAAP financial measures alongside other performance measures
and liquidity measures, including operating income, various cash
flow metrics, net income and our other GAAP results.
Berry Plastics Group, Inc.Investor Contact:Dustin
Stilwell, 812-306-2964dustinstilwell@berryplastics.comorMedia
Contact:Eva Schmitz,
812-306-2424evaschmitz@berryplastics.com
Berry Global (NYSE:BERY)
Historical Stock Chart
From Mar 2024 to Apr 2024
Berry Global (NYSE:BERY)
Historical Stock Chart
From Apr 2023 to Apr 2024