Intertape Polymer Group Reports 2021 Second Quarter Results

“It was another outstanding quarter with demand driving robust growth in revenue, adjusted net earnings and adjusted EBITDA. We continue to experience strong organic growth into August led by the categories where we have made investments in capex and acquisitions, like water-activated tape, protective packaging, wovens and carton sealing tapes,” said Greg Yull, President and CEO of IPG. “While the supply chain environment remains volatile in terms of pricing and consistency of supply, we continue to effectively cover the dollar contribution spread between selling price and raw materials plus freight. We maintained our adjusted EBITDA margin(1) at over 17 percent and our team has been effectively navigating the supply constraints to ensure we continue to meet customer demand. The business is structurally different than it was just a few years ago and our recent performance demonstrates its ability to adapt to change and deliver results for shareholders. The strength of our product bundle, our scale, our world class, low cost manufacturing assets and the improvements made to our capital structure position us to compete effectively and continue to win in a post-COVID-19 environment.”

Second Quarter 2021 Highlights (as compared to second quarter 2020):
• Revenue increased 40.7% to $376.7 million primarily due to organic growth in certain film, woven, and tape products, including continued strength in products with significant e-commerce end-market exposure such as water-activated tape and dispensing machines.
• Gross margin increased to 23.7% from 21.3% primarily due to a favourable product volume/mix and an increase in the spread between selling prices and combined raw material and freight costs.
• Net earnings attributable to the Company shareholders (“IPG Net Earnings”) decreased $0.1 million to $14.3 million ($0.24 basic and diluted earnings per share) primarily due to (i) an increase in finance costs mainly due to the 2018 Senior Unsecured Notes Redemption Charges(2) and the non-recurrence of a gain in the second quarter of 2020 resulting from a fair value adjustment to the Company’s contingent consideration related to the Nortech Acquisition(3) and (ii) an increase in selling, general and administrative expenses (“SG&A”) mainly due to increases in both variable and share-based compensation. The unfavourable impacts were largely offset by an increase in gross profit.
• Free cash flows(1) decreased by $28.8 million to $6.4 million primarily due to the decrease in cash flows from operating activities and an increase in capital expenditures as compared to minimal capital expenditures in 2020 as a precautionary measure given market uncertainty caused by COVID-19.
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