Glatfelter Reports Fourth Quarter and Full Year 2019 Results

Glatfelter (NYSE: GLT), a leading global supplier of engineered materials, today reported its results for the fourth quarter of 2019. Due to the divestiture of the Specialty Papers business in October 2018, its results are classified as discontinued operations for all periods presented in this release. During the quarter, the Company recorded a non-cash $75.3 million pre-tax charge in connection with the termination and settlement of the qualified pension plan.

On an adjusted basis, earnings from continuing operations for the fourth quarter of 2019 were $7.7 million, or $0.17 per share, compared with $1.4 million, or $0.03 per share, for the same period a year ago. Adjusted earnings is a non-GAAP financial measure for which a reconciliation to the nearest GAAP-based measure is provided within this release.

Consolidated net sales totaled $231.0 million and $229.5 million for the three months ended December 31, 2019 and 2018, respectively. On a constant currency basis, Airlaid Materials’ net sales increased by 1.7% and Composite Fibers’ net sales increased by 3.4%.

“Glatfelter continued to deliver solid performance in the fourth quarter and closed a remarkable year as we took several important steps toward transforming to a higher-margin, growth-oriented engineered materials company,” said Dante C. Parrini, Chairman and Chief Executive Officer. “This was a breakthrough year for our Airlaid Materials segment, delivering record EBITDA from increased shipments of 11% within its legacy business, above the targeted range, and reporting full-year operating profit from our Steinfurt acquisition at the high end of the projected range. We made major improvements to our corporate cost base and reduced interest expense by restructuring our debt. In addition, we settled our legacy qualified pension liabilities and terminated the plan, creating the ability to revert surplus cash to the company, further improving our financial flexibility through a substantial reduction in leverage.”

“In Composite Fibers, we are pleased to see meaningful improvement in operating profit of 51% during the fourth quarter compared to the prior year despite market conditions putting pressure on our performance throughout the year. This quarter’s improvement was due to ongoing cost reduction efforts and a recovery in volumes with growth of 2%, primarily from technical specialties and food and beverage products. In Airlaid Materials, shipments improved by 6% during the quarter compared to last year based on continued strong demand for adult incontinence and table top products.”

Mr. Parrini concluded, “We made substantial progress on our ongoing business transformation in 2019, with more to accomplish in 2020. Coming off a record year for Airlaid Materials, we expect the segment to grow in line with market levels. In Composite Fibers, we started 2020 by announcing a restructuring of our Gernsbach, Germany facility, including the discontinuation of its Metalized production, which will now be concentrated in the Caerphilly, UK facility. We took these necessary steps for Glatfelter to remain competitive as we continue to optimize our manufacturing footprint. Ultimately, the combined actions we have taken across the enterprise to achieve a more growth-driven portfolio, leaner cost structure and new operating model have created significant shareholder value and positioned us well for continued success.”
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