Viskase: weaker earnings

US-based food packaging provider Viskase Companies has announced a rise in earnings for the second quarter 2002, despite a small drop in sales.

Net sales were $46.3 million (€47.3m) for the three months ended 30 June 2002, a decrease of 0.5 per cent from the same period of 2001 of $46.5 million. Net sales were $89.7 million for the six months ended 30 June 2002, a decrease of 5.1 per cent from the same period of 2001 of $94.5 million. Lower sales results continue to reflect reduced worldwide selling prices for the company's cellulose casings.

Operating income for the second quarter and first six months of 2002 were $6.1 million and $3.6 million, respectively. The operating income includes a net restructuring income of $6.1 million recognized in the second quarter of 2002. The restructuring income is the result of a reversal of $9.3 million of excess reserve from the year 2000 representing a reduction in Nucel technology third party license fees, offset by a second quarter 2002 restructuring charge of $3.2 million.

Operating loss, excluding the net restructuring income of $6.1 million, for the second quarter and first six months of 2002 was $.1 million and (2.5 million, respectively. This compares favourably to operating loss from the comparable prior year periods of $2.5 million and $5.2 million, respectively. The improved financial results stem from improved operating efficiencies throughout the company's worldwide operations.

Earnings before interest, tax, depreciation and amortisation and (EBITDA) for the three months ended 30 June 2002 was $5.6 million, an increase of 66 per cent over the $3.4 million in the same quarter of 2001. EBITDA for the six months ended 30 June 2002 was $8.9 million compared with the six month period ended 30 June 2001 of $6.7 million, an increase of 34 per cent. EBITDA for the three months and six months ended 30 June 2002 excludes the restructuring income of $6.1 million.

Net income (loss) for the three months ended 30 June 2002 was $1.1 million, compared with the same period of 2001 of $(7.8). Net (loss) for the six months ended 30 June 2002 was $6.8 million, compared with the same period of 2001 of $8.9 million, representing a 23.8 per cent improvement over the six month period ending 30 June 2001. The net income (loss) for the three months and six months ended 30 June 2002 benefited from the restructuring income of $6.1 million.

Viskase Companies has its major interests in food packaging. Principal products manufactured are cellulosic and nylon casings used in the preparation and packaging of processed meat products.