Polyair Inter Pack Inc.

Polyair Inter Pack Inc.

June 07, 2007 19:41 ET

Polyair Inter Pack Inc. Announces 2007 Second Quarter Results and Completion of $6.9 Million Sale and Leaseback

TORONTO, ONTARIO--(Marketwire - June 7, 2007) - Polyair Inter Pack Inc. ("PPK" or the "Company") (TSX:PPK) announced a net profit from continuing operations, before an asset impairment charge, of $1.3 million on sales of $31 million. For the same quarter in 2006, the Company reported a net loss from continuing operations of $0.4 million on sales of $32.9 million. The Company has reported results from its Pool, PXL and PSC divisions as discontinued operations to reflect the sale of these businesses.

All amounts are expressed in thousands of U.S. dollars, except for number
of shares outstanding and per share amounts.

3 Months Ended 6 Months Ended
28-Apr 29-Apr 28-Apr 29-Apr
2007 2006 2007 2006
--------------- ---------------

Sales from continuing operations $30,981 $32,886 $58,383 $61,497

Earnings from continuing operations
before Interest, Taxes, Depreciation 2,648 1,066 3,807 1,270
and Amortization (EBITDA)(i)

Income / (loss) from continuing
operations before capital equipment
impairment charge 1,302 (395) 52 (1,965)

Loss from continuing operations (812) (395) (2,062) (1,965)
Income / (loss) from discontinued
operations 67 (1,904) 4,776 (5,632)
Net income / (loss) ($745) ($2,299) $2,714 ($7,597)

Net income / (loss) per share from
continuing operations
- Basic ($0.12) ($0.06) ($0.30) ($0.29)
- Diluted ($0.12) ($0.06) ($0.30) ($0.29)

Net income / (loss) per share from
discontinued operations
- Basic $0.01 ($0.28) $0.70 ($0.83)
- Diluted $0.01 ($0.28) $0.70 ($0.83)

Net income / (loss) per share
- Basic ($0.11) ($0.34) $0.40 ($1.12)
- Diluted ($0.11) ($0.34) $0.40 ($1.12)


Weighted average number of shares
(in millions) - Basic 6.8 6.8 6.8 6.8
- Diluted 6.8 6.8 6.8 6.8

Prior period amounts have been reclassifed from statements previously
presented to conform to the presentation of the 2007 second quarter
Interim Consolidated Financial Statements.

(i) EBITDA is not a recognized measure under Canadian Generally Accepted
Accounting Principles and readers are cautioned that EBITDA should not be
considered as an alternative to net income or loss or cash from operating
activities as an indicator of the Company's performance or cash flows.
EBITDA, as calculated by the Company, is net income or loss from continuing
operations before extraordinary items, net interest expenses and other,
depreciation and amortization, and income taxes. Full interim financial
statements along with Management's Discussion and Analysis can be obtained
from SEDAR (www.sedar.com) and the Company's web site at www.polyair.com


The results of the Company's Packaging Division have continued to improve from those reported in fiscal 2006. This improvement is due to lower material and operating costs as the Company improved its operating efficiency and contained its selling, general and administrative costs. With these improvements, earnings before depreciation, interest and taxes (EBITDA) increased to $2.7 million from $1.1 million a year earlier.

In the quarter, the Company reviewed the excess equipment, remaining from the 2006 closure of its Rexdale film plant, that was to be redeployed into the remaining facilities. Based on its current operating plan and recent estimates, management has written off the value of this equipment by $2.1 million to reflect the disposal value of excess equipment and the cost of refurbishment of the remaining equipment.

On June 6th 2007, the Company completed the sale and leaseback of two of its US production facilities for proceeds of $6.9 million. These funds will be used to retire $6.2 million of term debt and cancel a $2.1 million letter of credit. The cancellation of the letter of credit will result in a corresponding increase in available credit under the Company's operating bank line.

"I am pleased to report improved operating results this quarter and the accomplishment of several initiatives that will improve the liquidity of the Company. We intend to increase our efforts to grow our sales and to further increase operating efficiency in the coming quarters," stated Victor D'Souza, CEO in announcing the Company's results.

Polyair Inter Pack Inc. (www.Polyair.com) manufactures and distributes a wide range of protective packaging products in North America. The Company operates eight manufacturing facilities, seven of which are in the USA where it generates the majority of its sales.

Certain information included in this news release contains statements that are forward-looking. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of Polyair Inter Pack Inc. In addition, Polyair Inter Pack Inc. expressly disclaims any obligation to publicly update or alter its previously issued forward-looking statements.

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