) reported first-quarter 2013 adjusted earnings of 64 cents per
share, flat compared with the year-ago quarter. The results
narrowly missed the Zacks Consensus Estimate of 66 cents.
Earnings came at the lower end of management's guidance range of
64 cents to 69 cents.
Earnings in the reported quarter exclude a negative impact of 5
cents per share related to the European Operations Optimization
plan. Including this, earnings declined 7.8% to 59 cents per
share from the prior-year quarter's earnings of 64 cents per
Total revenue increased 4% year over year to $618 million but
missed the Zacks Consensus Estimate of $634 million. Core sales
increased 4% excluding currency effects and acquisition. Changes
in currency exchange rates had 1% negative impact on sales in the
quarter. Aptar Stelmi contributed approximately $35 million to
sales in the quarter. Sales growth in Latin America and Asian
markets remained strong.
Cost of sales went up 4.3% to $418 million in the reported
quarter. Selling, Research & Development and Administrative
expenses increased 6.5% to $94 million. Operating income declined
8% to $64 million with operating margin contracting 140 basis
points (bps) to 10.5%.
Total revenue in the Beauty + Homes segment declined 3.6% to $363
million in the quarter. Operating income declined 26% to $24
million. Segment operating margin decreased 200 basis points to
6.7%. Segment's sales and income were negatively impacted by
softer than anticipated volumes in the U.S. Segment operating
margin decreased 200 basis points to 6.7%.
Total revenue in the Pharma segment increased 21% to $169
million. Operating income went up 17% to $46 million. However,
operating margin contracted 90 bps to 27.2%.
Total revenue in the Food + Beverage segment jumped 13% to $85
million. Operating income increased 26% to $8.5 million.
Operating margin also expanded 100 basis points to 10% in the
As of Mar 31, 2013, cash and cash equivalents amounted to $225.1
million versus $229.7 million as of Dec 31, 2012. Total debt
amounted to $441.6 million as of Mar 31, 2013, compared with
$427.5 million as of Dec 31, 2012. The debt-to-capitalization
ratio expanded to 24.1% as of Mar 31, 2013 from 23.6% as of Dec
Optimization Plan of European Operations
AptarGroup in the first quarter recognized around $4.5 million of
expense regarding the plan, of which $0.5 million were non-cash
expenses. Using current exchange rates, the company expects about
$9 million additional costs, most of which will be incurred in
2013. Annual savings of roughly $12 million are expected to begin
later this year.
AptarGroup expects earnings to remain in the range of 73 cents to
78 cents per share for the second quarter of 2013. The guidance
does not include any impact from the European Operations
The company anticipates income from the Beauty + Home segment to
improve in the second quarter. The company is optimistic about
its Pharma business expecting a normalized order level in the
U.S. generic allergy and European consumer health care markets in
the second quarter. Also, Aptar Stelmi is expected to continue to
Crsytal Lake, Illinois-based AptarGroup is a leading global
supplier of a broad range of innovative dispensing systems for
the fragrance/cosmetic, personal care, pharmaceutical, household
and food/beverage markets. AptarGroup currently retains a
short-term Zacks Rank #3 (Hold).
Other companies in the packaging and containers industry with
favorable Zacks Ranks are
Graphic Packaging Holding Company
UFP Technologies, Inc.
Packaging Corporation of America
). While Graphic Packaging and UFP Technologies hold a Zacks Rank
#1 (Strong Buy), Packaging Corporation carries a Zacks Rank #2
APTARGROUP INC (ATR): Free Stock Analysis
GRAPHIC PKG HLD (GPK): Free Stock Analysis
PACKAGING CORP (PKG): Free Stock Analysis
UFP TECH INC (UFPT): Free Stock Analysis
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