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First Quarter 2009 Highlights Include:
- Price actions implemented last year were sustained; average selling price was up 5.7% year-over-year in the first quarter.
- Gross margin expanded by 200 basis points sequentially to 26.9% due to pricing discipline, improved mix, and the initial benefits of lower raw material costs.
- SG&A expenses declined on an absolute basis compared to the year-ago period and sequentially.
- Balance sheet remains strong with prudent leverage and ample liquidity.
- The acquisition of Nordic Adhesives in Europe will enhance the company’s differentiated product offering in the flexible packaging market.
Net income for the first quarter of 2009 was $6.1 million, or $0.13 per diluted share, versus $18.2 million, or $0.32 per diluted share, in last year’s first quarter. The 2009 first quarter results included a non-cash “true-up” for the estimated goodwill impairment charge taken in the fourth quarter of 2008 associated with the Specialty Construction Brands business component. On a pre-tax basis, this non-cash charge totaled $0.8 million in the first quarter. On an after-tax basis, the 2009 first quarter impairment charge was $0.5 million, or $0.01 per diluted share. Excluding this non-cash impairment charge, the adjusted first quarter 2009 net income was $6.6 million, or $0.14 per diluted share.
Net revenue for the first quarter of 2009 was $278.6 million, down 13.7% versus the first quarter of 2008. Higher average selling prices and the 2008 acquisition in Egypt positively impacted net revenue growth by 5.7 and 0.4 percentage points, respectively. Lower volume and unfavorable foreign currency translation adversely impacted net revenue growth by 14.7 and 5.1 percentage points, respectively.
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