SchweitzerMauduit International Inc. (SWM, Financial) filed Quarterly Report for the period ended 2009-06-30.
Schweitzer-Mauduit International Inc. is a diversified producer of premium specialty papers and the world\'s largest supplier of fine papers to the tobacco industry. SchweitzerMauduit International Inc. has a market cap of $525.9 million; its shares were traded at around $34.4 with a P/E ratio of 21.8 and P/S ratio of 0.7. The dividend yield of SchweitzerMauduit International Inc. stocks is 1.7%.
Gross profit was $44.6 million in the three month period ended June 30, 2009, an increase of $20.4 million from the prior-year quarter. The gross profit margin was 24.3 percent, increasing from 12.0 percent in the prior-year quarter. Restructuring and impairment expenses were $13.3 million and $3.7 million for the three months ended June 30, 2009 and 2008, respectively. Operating profit was $12.0 million in the three months ended June 30, 2009 versus $4.8 million in the prior-year quarter. The higher gross profit and operating profit were both primarily due to $16.4 million in higher average selling prices and a favorable mix of products sold, $6.6 million in cost savings and mill operating efficiencies due to a lack of recurring machine start-up costs of $3.9 million in 2008, and $1.6 million in currency exchange benefits. These benefits were partially offset by $3.6 million in higher non-manufacturing expenses, primarily due to higher incentive compensation accruals as well as consulting expenses associated with strategic planning activities, and $2.0 million from decreased sales volumes.
Net sales were $367.4 million during the six months ended June 30, 2009, a 6.2 percent decrease over the prior-year period. Net sales decreased $24.4 million as a result of $33.4 million in unfavorable foreign currency exchange rate impacts, $29.4 million from a 13% decrease in sales volumes and $2.1 million in lower French tipping paper sales following announcement of the closure of our finished tipping facility in Malaucène, France. These declines were partially offset by $40.5 million in higher average selling prices, primarily due to an improved mix of products sold.
Gross profit was $86.2 million in the six month period ended June 30, 2009, an increase of $42.0 million from the prior-year quarter. The gross profit margin was 23.5 percent, increasing from 11.3 percent in the prior-year period. Restructuring and impairment expenses were $13.6 million and $5.7 million for the six months ended June 30, 2009 and 2008, respectively. Operating profit was $34.8 million in the six months ended June 30, 2009 versus $4.8 million in the prior-year period. The higher gross profit and operating profit were both primarily due to $32.9 million in higher average selling prices and a favorable mix of products sold, $11.5 million in cost savings and mill operating efficiencies due to a lack of $9.2 million in machine start-up costs incurred in 2008, and $2.2 million in currency exchange benefits. These benefits were partially offset by $4.1 million in higher non-manufacturing expenses, primarily due to higher incentive compensation accruals, consulting expenses associated with strategic planning activities and severance expenses, and $3.9 million from decreased sales volumes.
In April 2009, we announced a decision to close our finished tipping paper facility, Papeteries de Malaucène SAS, located in France. Due to ongoing losses at the facility, the Company previously recorded a $13.5 million fixed asset impairment charge in the fourth quarter of 2008, which included the majority of the related fixed asset values. This mill closure is expected to result in severance of approximately 210 employees. We recorded $12.2 million in restructuring expense including $11.4 million in estimated cash severance payments and $0.8 million in non-cash charges in the second quarter of 2009. We expect additional expenses, net of reversals of employee-related accruals, related to this action of approximately $13 million through its planned completion in the fourth quarter of 2009. Payment of the cash severances is expected to be completed by the end of 2010, with approximately $6 million expected to be paid during 2009.
Total restructuring and impairment expense of $13.3 million was recognized during the three months ended June 30, 2009, comprised of $12.5 million for severance related and other cash costs and $0.8 for other non-cash charges. Total restructuring and impairment expense of $3.7 million was recognized during the prior-year quarter, comprised of $2.5 million for asset impairments and other non-cash charges and $1.2 million for severance related and other cash costs.
Read the The complete ReportSWM is in the portfolios of Richard Pzena of Pzena Investment Management LLC.
Schweitzer-Mauduit International Inc. is a diversified producer of premium specialty papers and the world\'s largest supplier of fine papers to the tobacco industry. SchweitzerMauduit International Inc. has a market cap of $525.9 million; its shares were traded at around $34.4 with a P/E ratio of 21.8 and P/S ratio of 0.7. The dividend yield of SchweitzerMauduit International Inc. stocks is 1.7%.
Highlight of Business Operations:
Net sales were $183.3 million in the three month period ended June 30, 2009, a 9.3 percent decrease over the prior-year quarter. Net sales decreased $18.7 million as a result of $19.4 million from a 15 percent decrease in unit sales volumes, $17.1 million in unfavorable foreign currency exchange rate impacts from a stronger U.S. dollar compared to the euro and Brazilian real and $3.1 million due to lower sales following announcement of the closure of our finished tipping facility in Malaucène, France. These declines were partially offset by $20.9 million in higher average selling prices, primarily due to an improved mix of products sold.Gross profit was $44.6 million in the three month period ended June 30, 2009, an increase of $20.4 million from the prior-year quarter. The gross profit margin was 24.3 percent, increasing from 12.0 percent in the prior-year quarter. Restructuring and impairment expenses were $13.3 million and $3.7 million for the three months ended June 30, 2009 and 2008, respectively. Operating profit was $12.0 million in the three months ended June 30, 2009 versus $4.8 million in the prior-year quarter. The higher gross profit and operating profit were both primarily due to $16.4 million in higher average selling prices and a favorable mix of products sold, $6.6 million in cost savings and mill operating efficiencies due to a lack of recurring machine start-up costs of $3.9 million in 2008, and $1.6 million in currency exchange benefits. These benefits were partially offset by $3.6 million in higher non-manufacturing expenses, primarily due to higher incentive compensation accruals as well as consulting expenses associated with strategic planning activities, and $2.0 million from decreased sales volumes.
Net sales were $367.4 million during the six months ended June 30, 2009, a 6.2 percent decrease over the prior-year period. Net sales decreased $24.4 million as a result of $33.4 million in unfavorable foreign currency exchange rate impacts, $29.4 million from a 13% decrease in sales volumes and $2.1 million in lower French tipping paper sales following announcement of the closure of our finished tipping facility in Malaucène, France. These declines were partially offset by $40.5 million in higher average selling prices, primarily due to an improved mix of products sold.
Gross profit was $86.2 million in the six month period ended June 30, 2009, an increase of $42.0 million from the prior-year quarter. The gross profit margin was 23.5 percent, increasing from 11.3 percent in the prior-year period. Restructuring and impairment expenses were $13.6 million and $5.7 million for the six months ended June 30, 2009 and 2008, respectively. Operating profit was $34.8 million in the six months ended June 30, 2009 versus $4.8 million in the prior-year period. The higher gross profit and operating profit were both primarily due to $32.9 million in higher average selling prices and a favorable mix of products sold, $11.5 million in cost savings and mill operating efficiencies due to a lack of $9.2 million in machine start-up costs incurred in 2008, and $2.2 million in currency exchange benefits. These benefits were partially offset by $4.1 million in higher non-manufacturing expenses, primarily due to higher incentive compensation accruals, consulting expenses associated with strategic planning activities and severance expenses, and $3.9 million from decreased sales volumes.
In April 2009, we announced a decision to close our finished tipping paper facility, Papeteries de Malaucène SAS, located in France. Due to ongoing losses at the facility, the Company previously recorded a $13.5 million fixed asset impairment charge in the fourth quarter of 2008, which included the majority of the related fixed asset values. This mill closure is expected to result in severance of approximately 210 employees. We recorded $12.2 million in restructuring expense including $11.4 million in estimated cash severance payments and $0.8 million in non-cash charges in the second quarter of 2009. We expect additional expenses, net of reversals of employee-related accruals, related to this action of approximately $13 million through its planned completion in the fourth quarter of 2009. Payment of the cash severances is expected to be completed by the end of 2010, with approximately $6 million expected to be paid during 2009.
Total restructuring and impairment expense of $13.3 million was recognized during the three months ended June 30, 2009, comprised of $12.5 million for severance related and other cash costs and $0.8 for other non-cash charges. Total restructuring and impairment expense of $3.7 million was recognized during the prior-year quarter, comprised of $2.5 million for asset impairments and other non-cash charges and $1.2 million for severance related and other cash costs.
Read the The complete ReportSWM is in the portfolios of Richard Pzena of Pzena Investment Management LLC.
