Berry Plastics Reports Profit Jump

Posted: Updated:

Evansville-based Berry Plastics Group Inc. (NYSE: BERY) is reporting fiscal third quarter net income of $40 million, compared to $9 million for the same period last year. Chief Executive Officer Jon Rich says the manufacturer achieved many positive results, despite "continued soft consumer demand." August 1, 2013

News Release

EVANSVILLE, Ind. - Berry Plastics Group, Inc. (NYSE:BERY) today reported results for its fiscal third quarter 2013 referred to in the following as the June 2013 quarter:

Achieved a record for any third fiscal quarter with a June 2013 quarter Operating EBITDA of $208 million and LTM Adjusted EBITDA of $811 million

Reported the 12th consecutive quarter of increased year-over-year Operating EBITDA

Reduced net debt by $623 million and reduced our leverage ratio (net debt/Adjusted EBITDA) to 4.8x, a reduction of 1.0x from the June 2012 quarter

Recorded Adjusted net income per share of $0.35 for the June 2013 quarter compared to $0.22 in the June 2012 quarter

Achieved LTM Adjusted free cash flow of $282 million

Increased Operating EBITDA by almost 5 percent versus the June 2012 quarter and increased Operating EBITDA margin to 17.0 percent from 16.0 percent in the June 2012 quarter

"During the June 2013 quarter the Company achieved an Operating EBITDA record for any June quarter, despite the sustained pressure from continued soft consumer demand. The year-over-year Operating EBITDA margin improvements of 1 percent were achieved primarily through productivity, strategic cost reduction actions taken, and sourcing savings." said Jon Rich, Chairman and CEO of Berry Plastics.

June 2013 Quarter Results

For the quarter ended June 2013, the Company's net sales declined by 2 percent to $1,221 million from $1,242 million, primarily attributed to a volume decline of 2 percent. This decline is principally related to softer customer demand, year-over-year adverse change in weather and a reduction in raw material content, which was partially offset by volume gains in certain of our product lines.

June 2013 YTD Results

For June 2013 YTD, the Company's net sales declined by 3 percent to $3,443 million from $3,562 million as compared to the same period for 2012. This decline was primarily attributed to lower selling prices resulting from lower plastic resin costs in the December 2012 quarter, soft customer demand, the year-over-year adverse change in weather and reduction in raw material content; these factors were partially offset by sales from acquisitions and volume gains in certain of our product lines.

Capital Structure and Adjusted Free Cash Flow

The ratio of net debt of $3,917 million to Adjusted EBITDA for the four quarters ended June 29, 2013 of $811 million was 4.8x. The ratio at the end of September 29, 2012 quarter was 5.5x. The Company’s LTM Adjusted free cash flow was $282 million. Adjusted free cash flow for the June 2013 quarter was $63 million.

Outlook

For our September 2013 quarter, we believe the demand driven by economic activity will remain similar or up slightly to the environment we have experienced in the past several quarters. We are forecasting the September ending quarter revenue to be positive and up slightly and a modest improvement in Operating EBITDA versus the prior year. "As we move forward, Berry will remain focused on our key strategic initiatives to continue to drive shareholder value," said Rich.

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 with annual net sales of $4.8 billion in fiscal 2012. With world headquarters in Evansville, Indiana, the Company's common stock 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.

Source: Berry Plastics Group Inc.