Graham Packaging weathers uncertain economy
welcome increase in net income for 2002, despite a drop in sales
over the period, a result of low resin prices and restructuring in
Europe.
US plastic packaging company Graham Packaging has reported a welcome increase in net income for 2002, despite a small drop in sales over the period.
The company saw a 16 per cent gain over last year in adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) to $198.2 million, compared to $171.5 million for 2001.
"We are very pleased with our earnings growth this year and our company's continuing signs of strength, especially given the uncertainty in the economy and the volatility of the financial markets in general," said John Hamilton, chief financial officer.
The company saw net sales drop to $906.7 million (from $923.1 million) during 2002 but net income stood at $7.6 million, compared to losses of $44.0 million in the previous year.
"Our net sales were lower primarily because of lower resin prices utilised in our products," said chief executive officer Phillip R. Yates.
"In reality, we actually grew our 2002 business by more than 7 per cent in the number of units sold compared to the previous year. This is the continued result of adding new products and plants to support our customers," Yates added.
Graham Packaging opened new plants in the United States, France and Mexico in 2002, but while results from these are not yet evident ongoing strategic restructuring of European operations in the past year took its toll on sales. The company closed or sold unprofitable plants in France, Italy, and the United Kingdom.
"Excluding business impacted by the restructuring, sales would have increased by approximately 3 per cent in 2002 compared to 2001," claimed Yates.
