Tredegar Corporation (TG) reported its financial performance for the second quarter of 2024. The company achieved a net income of $8.8 million, or 26 cents per share against a net loss of $18.9 million, or 56 cents per share, in the same quarter of 2023.
Revenues for the quarter stood at $190.2 million, up from $178.2 million in the prior-year quarter, marking a notable improvement.
Tredegar’s second-quarter 2024 performance reflects a significant turnaround, driven by strategic cost management, operational improvements, and a recovering market environment. The quarterly performance showed sound performance in its PE Films segment.
Tredegar Corporation Price, Consensus and EPS Surprise
Tredegar Corporation price-consensus-eps-surprise-chart | Tredegar Corporation Quote
Business Segments Performance
Aluminum Extrusions (Bonnell Aluminum)
EBITDA for the Aluminum Extrusions segment was $12.9 million in the second quarter of 2024, up from $10.2 million in the second quarter of 2023. Sales volume was 34.9 million pounds, a slight decrease from 35.5 million pounds in the second quarter of 2023. Net sales amounted to $119.4 million, down 2% from $121.8 million in the year-ago quarter. Despite a slight decline in sales volume and net sales, the segment experienced improved EBITDA, driven by higher net pricing after metal cost adjustments, manufacturing cost improvements, and lower freight rates.
Net new orders increased 17% year over year, although open orders remained below pre-pandemic levels.
PE Films
PE Films reported EBITDA of $10.1 million in the second quarter of 2024, a substantial increase from $0.8 million in the second quarter of 2023. Sales volume increased significantly to 10.5 million pounds from 6.2 million pounds in the second quarter of 2023. Net sales for the segment were $29.2 million, an 83.4% increase from $15.9 million in the prior-year quarter. The exceptional performance of PE Films was largely due to increased sales volume in Surface Protection, driven by the restocking of customer inventories and favorable market conditions in the consumer electronics market.
Flexible Packaging Films (Terphane)
The Flexible Packaging Films segment achieved EBITDA of $3.2 million in the second quarter of 2024, up from $0.2 million the year-ago quarter. Sales volume increased to 25.1 million pounds, a rise from 23.7 million pounds in the second quarter of 2023. Net sales amounted to $34.5 million, up 4% from $33.2 million in the previous year’s quarter. This segment saw growth in sales volume and net sales, supported by lower raw material costs, favorable product mix, and cost improvements, despite pricing pressures due to excess global capacity.
Balance Sheet Position (As of Jun 30, 2024)
Cash and cash equivalents stood at $3.5 million, down from $10 million at the end of 2023.
Total assets were $450.4 million, a slight increase from $446.5 million at the end of 2023.
Long-term debt remained stable at $20 million.
Shareholders' equity increased to $160 million from $155.7 million.
Cash Flows
Operating cash flows for the first six months of 2024 were $7.3 million, a decrease from $22.7 million in the same period of 2023.
Other Developments
Tredegar is in the process of selling its Terphane business to Oben Group, pending approval from competition authorities in Brazil and Colombia. The sale is expected to yield after-tax net cash proceeds of $85 million, contingent upon the approval process's completion. The transaction is a part of the company's strategy to streamline operations and focus on its core businesses.
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