AptarGroup Inc. (ATR, Financial) filed Quarterly Report for the period ended 2009-09-30.
Aptargroup Inc. is a leader in the design manufacture and sale of threecategories of consumer product dispensing systems: pumps closures and aerosol valves. The company focuses on providing value-added dispensing systems to global consumer product marketers in the personal care fragrance/cosmetics pharmaceutical household/industrial products and food industries. Value-added packaging allows consumers to conveniently dispense a product in an aesthetically attractive package which consistently meets required usage or dosage characteristics. Aptargroup Inc. has a market cap of $2.36 billion; its shares were traded at around $34.93 with a P/E ratio of 19.8 and P/S ratio of 1.1. The dividend yield of Aptargroup Inc. stocks is 1.7%. Aptargroup Inc. had an annual average earning growth of 8.9% over the past 10 years. GuruFocus rated Aptargroup Inc. the business predictability rank of 3.5-star.
Depreciation and amortization decreased approximately $5.3 million in the first nine months of 2009 to $94.6 million compared to $99.9 million for the first nine months of 2008. Changes in foreign currency rates accounted for an $8.1 million decrease for a net increase of $2.8 million on a constant currency basis. The explanation for this increase is the same as the third quarter comments above. Depreciation and amortization as a percentage of sales increased to 7.0% of net sales for the nine months ended September 30, 2009 compared to 6.2% in the same period of the prior year.
Facilities consolidation and severance expenses were $2.6 million (0.5% of sales) in the third quarter of 2009. There were no corresponding expenses in 2008. The amount represents the recognition of expenses related to the Companys previously announced plan to consolidate several facilities and reduce headcount. The total amount recorded since the program was initiated during the second quarter of 2009 is $5.7 million (0.5% of sales). The total costs associated with the consolidation/severance programs are estimated to be approximately $7 million. Annual savings are estimated to be in the range of $3 million to $4 million primarily beginning in 2010.
Segment income in the third quarter of 2009 decreased approximately 21% to $16.8 million compared to $21.4 million reported in the same period in the prior year. Acquisitions did not materially impact segment income in the quarter. The decrease in segment income is due primarily to underutilized overhead and the negative impact of a $1.2 million charge related to severance expenses. The segment has implemented cost savings activities in an effort to offset this decrease in segment income. Excluding the charge for severance expenses, Beauty & Home segment income declined 16% or $3.3 million.
Segment income in the third quarter of 2009 decreased approximately 15% to $10.4 million compared to $12.3 million reported in the same period in the prior year. The primary cause for the decline is the negative impact of a $1.4 million charge relating to consolidation/severance expenses. Excluding the charge for consolidation/severance expenses, Closures segment income declined 4% or $0.5 million.
We used $109.5 million in cash for investing activities during the first nine months of 2009, compared to $172.4 million during the same period a year ago. The decrease in cash used for investing activities is due primarily to $54.3 million less spent on capital expenditures in the first nine months of 2009 compared to the first nine months of 2008. Cash outlays for capital expenditures for 2009 are estimated to be approximately $130 million but could vary due to changes in exchange rates as well as the timing of capital projects. In 2008, approximately $6.3 million in cash was used to purchased the remaining 50% that it did not already own of Seaplast S.A., approximately $9.3 million in cash was used to acquire the bag-on-valve business of CCL Industries and approximately $4.1 million in cash was used to acquire 70% of the outstanding shares of Next Breath LLC. In 2009, approximately $7.6 million in cash was used to acquire Covit do Brasil.
Read the The complete ReportATR is in the portfolios of John Keeley of Keeley Fund Management, Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC, Ruane Cunniff of Ruane & Cunniff & Goldfarb Inc.
Aptargroup Inc. is a leader in the design manufacture and sale of threecategories of consumer product dispensing systems: pumps closures and aerosol valves. The company focuses on providing value-added dispensing systems to global consumer product marketers in the personal care fragrance/cosmetics pharmaceutical household/industrial products and food industries. Value-added packaging allows consumers to conveniently dispense a product in an aesthetically attractive package which consistently meets required usage or dosage characteristics. Aptargroup Inc. has a market cap of $2.36 billion; its shares were traded at around $34.93 with a P/E ratio of 19.8 and P/S ratio of 1.1. The dividend yield of Aptargroup Inc. stocks is 1.7%. Aptargroup Inc. had an annual average earning growth of 8.9% over the past 10 years. GuruFocus rated Aptargroup Inc. the business predictability rank of 3.5-star.
Highlight of Business Operations:
Depreciation and amortization expenses increased approximately $0.5 million in the second quarter of 2009 to $33.0 million compared to $32.5 million in the third quarter of 2008. Changes in foreign currency rates accounted for a $1.3 million decrease, resulting in a net increase of $1.8 million on a constant currency basis. The increase is related to the write-off of certain license agreements that were deemed to have no value in the third quarter plus higher than normal capital expenditures during 2008. Depreciation and amortization as a percentage of net sales increased to 7.0% in the third quarter of 2009 compared to 6.1% for the same period a year ago due to the decrease in sales.Depreciation and amortization decreased approximately $5.3 million in the first nine months of 2009 to $94.6 million compared to $99.9 million for the first nine months of 2008. Changes in foreign currency rates accounted for an $8.1 million decrease for a net increase of $2.8 million on a constant currency basis. The explanation for this increase is the same as the third quarter comments above. Depreciation and amortization as a percentage of sales increased to 7.0% of net sales for the nine months ended September 30, 2009 compared to 6.2% in the same period of the prior year.
Facilities consolidation and severance expenses were $2.6 million (0.5% of sales) in the third quarter of 2009. There were no corresponding expenses in 2008. The amount represents the recognition of expenses related to the Companys previously announced plan to consolidate several facilities and reduce headcount. The total amount recorded since the program was initiated during the second quarter of 2009 is $5.7 million (0.5% of sales). The total costs associated with the consolidation/severance programs are estimated to be approximately $7 million. Annual savings are estimated to be in the range of $3 million to $4 million primarily beginning in 2010.
Segment income in the third quarter of 2009 decreased approximately 21% to $16.8 million compared to $21.4 million reported in the same period in the prior year. Acquisitions did not materially impact segment income in the quarter. The decrease in segment income is due primarily to underutilized overhead and the negative impact of a $1.2 million charge related to severance expenses. The segment has implemented cost savings activities in an effort to offset this decrease in segment income. Excluding the charge for severance expenses, Beauty & Home segment income declined 16% or $3.3 million.
Segment income in the third quarter of 2009 decreased approximately 15% to $10.4 million compared to $12.3 million reported in the same period in the prior year. The primary cause for the decline is the negative impact of a $1.4 million charge relating to consolidation/severance expenses. Excluding the charge for consolidation/severance expenses, Closures segment income declined 4% or $0.5 million.
We used $109.5 million in cash for investing activities during the first nine months of 2009, compared to $172.4 million during the same period a year ago. The decrease in cash used for investing activities is due primarily to $54.3 million less spent on capital expenditures in the first nine months of 2009 compared to the first nine months of 2008. Cash outlays for capital expenditures for 2009 are estimated to be approximately $130 million but could vary due to changes in exchange rates as well as the timing of capital projects. In 2008, approximately $6.3 million in cash was used to purchased the remaining 50% that it did not already own of Seaplast S.A., approximately $9.3 million in cash was used to acquire the bag-on-valve business of CCL Industries and approximately $4.1 million in cash was used to acquire 70% of the outstanding shares of Next Breath LLC. In 2009, approximately $7.6 million in cash was used to acquire Covit do Brasil.
Read the The complete ReportATR is in the portfolios of John Keeley of Keeley Fund Management, Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC, Ruane Cunniff of Ruane & Cunniff & Goldfarb Inc.
