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Coveris Reports Third Quarter 2017 Financial Results

  • In constant currency, flat sales year over year
  • Realized $15 million in productivity gains during the quarter
  • Positive volume growth in continental Europe
  • Sequential improvement in adjusted EBITDA

CHICAGO--(BUSINESS WIRE)-- Coveris Holdings S.A. reported net sales of $628 million for the third quarter of 2017 versus $620 million in the third quarter of 2016. Excluding a $7 million impact of currency, the third quarter sales were essentially flat compared with the same quarter in the prior year.

Adjusted EBITDA for the quarter was $71 million, compared to $78 million for the same period in the prior year. The decline is primarily related to softer volumes and product mix, particularly in the Company’s flexibles business in the US and UK.

“Coveris third quarter results demonstrated that our financial performance is improving despite significant challenges,” said Dimitri Panayotopoulos, Chairman and Interim Chief Executive Officer. “We recently announced a realignment into four more focused, leaner, strategic business units. The trend of improvement quarter by quarter is expected to continue as we move forward into the fourth quarter and 2018.”

Please see our Adjusted EBITDA Reconciliation attached to this press release. Additional financial information may be found on www.coveris.com under the Investor Relations section.

EARNINGS CALL
A conference call hosted by management to discuss these financial results will be held on November 17, at 9:00 am, Eastern. The conference call number is 877-407-8031 (domestic) or 201-689-8031 (international). A replay of the call will be available after 1:30 pm, Eastern on November 17 until November 24, 2017, by dialing 877-481-4010 (domestic) or 919-882-2331 (international) with the conference ID of 22494.

ABOUT COVERIS
As a leading international manufacturing company, Coveris is dedicated to providing solutions that enhance the safety, quality and convenience of products we use every day. In partnership with the most respected brands in the world, Coveris develops vital products that protect everything from the food we eat, to medical supplies, to the touch screen device in our pockets, contributing to the lives of millions every day. Coveris is an affiliated portfolio company of Sun Capital Partners, Inc.

www.coveris.com

FORWARD-LOOKING STATEMENTS:
Statements in this release that are not historical are “forward-looking statements.” Forward-looking statements may be identified by the use of forward-looking terminology such as the words “should,” “would,” “could,” “will,” “may,” “expect,” “believe,” “anticipate,” “attempt,” “project” and other terms with similar meaning indicating possible future events or potential impact on our business. You are cautioned not to place undue reliance on these forward-looking statements, which are not guarantees of future performance. These statements are based on management’s current assumptions, beliefs and expectations, all of which involve a number of business risks and uncertainties that could cause actual results to differ materially. The forward-looking statements in this release are subject to uncertainty and changes in circumstances and involve risks and uncertainties that may affect Coveris’ operations, markets, products, services, prices and other factors. Significant risks and uncertainties may relate to, but are not limited to, financial, economic, competitive, environmental, political, legal, regulatory and technological factors. In addition, any forward-looking statements are made only as of the date of this release, and Coveris does not intend and does not assume any obligation to update any statements set forth in this release.

COVERIS HOLDINGS S.A.
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP ADJUSTED EBITDA
(Expressed in millions of U.S. dollars)
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
30-Sep-17 30-Sep-16 30-Sep-17 30-Sep-16
U.S. GAAP Net income (loss) $ (16.1 ) $ (27.9 ) $ (46.7 ) $ (69.7 )
Interest expense, net 33.4 39.0 93.2 107.2
(Benefit) provision for income taxes (4.9 ) (12.1 ) (13.1 ) (9.7 )
Depreciation and amortization 40.3 37.7 115.4 112.3
Non-GAAP EBITDA $ 52.7 $ 36.7 $ 148.8 $ 140.1
Non-Operational Adjustments:
Accounting Manual Compliance - 0.1 - 0.4
(Gain) loss on disposal of assets (0.1 ) 4.9 0.4 6.0
Pension revaluation - - - -
Foreign currency exchange (gain) loss (4.4 ) 17.0 (8.8 ) 55.4
Other - 0.9 (1.5 ) 1.7
Total Non-Operational Adjustments $ (4.5 ) $ 22.9 $ (9.9 ) $ 63.5
Special Items:
Restructuring and related relocation costs(a) 9.6 7.8 20.8 16.9
Management fees and expenses 1.9 2.1 6.1 6.4
Transaction related expenses(b) 0.9 0.8 3.1 1.2
Business improvement consulting cost 10.2 1.6 27.1 5.5
Other expenses(c) (0.2 ) 5.8 3.5 10.3
Total Special Items: 22.4 18.1 60.6 40.3
Non-GAAP Adjusted EBITDA $ 70.6 $ 77.7 $ 199.5 $ 243.9
(a) Costs associated primarily with various restructuring activities, employee relocation expenses or employee severance costs.
(b) Costs associated with transactions and acquisition costs.
(c) Costs associated with one-time information technology initiatives, declaration of force majeure by suppliers, rebranding and other infrequent expenses.

View source version on businesswire.com: http://www.businesswire.com/news/home/20171116005992/en/

Coveris Holdings S.A.
Investor Contact:
Duane A. Owens, 864-641-4710
Treasurer
duane.owens@coveris.com
or
Media Contact:
Chris Swalm, 864-504-6145
Marketing Communications Manager
chris.swalm@coveris.com

Source: Coveris Holdings S.A.