Tredegar Reports First Quarter 2025 Results
First quarter 2025 net income (loss) from continuing operations was
First Quarter Financial Results Highlights
-
Earnings before interest, taxes, depreciation and amortization (“EBITDA”) from ongoing operations for Aluminum Extrusions was
$9.2 million $12.5 million $9.7 million - Sales volume was 37.9 million pounds in the first quarter of 2025 versus 33.8 million pounds in the first quarter of 2024.
-
Net new orders increased
36% in the first quarter of 2025 versus the first quarter of 2024 and24% versus the fourth quarter of 2024. Open orders at the end of the first quarter of 2025 were 25 million pounds, which is up from 15 million pounds at the end of the first quarter of 2024 and 17 million pounds at the end of the fourth quarter of 2024.
-
EBITDA from ongoing operations for PE Films was
$7.5 million $6.9 million $7.6 million - Sales volume was 9.6 million pounds in the first quarter of 2025 versus 10.0 million pounds in the first quarter of 2024.
John Steitz, Tredegar’s president and chief executive officer, said, “Bonnell Aluminum’s sales volume, net new orders and open orders continue to show recovery from the down cycle that we believe hit bottom in the third quarter of 2023. The new Section 232 tariffs on aluminum imports have been implemented with no country-specific or product-specific exclusions occurring to date, which is good for our industry as certain imports have been priced at below fair value. Tariffs are a pass through to customers.”
Mr. Steitz continued, “PE Films had another exceptional first quarter. We expect the balance of the year to normalize. To date, we have not experienced an adverse impact on customer demand related to potential tariff actions, but the situation remains fluid.”
Mr. Steitz concluded, “Our balance sheet remains strong with a net leverage ratio of 1.1x at the end of March. On May 6th, we refinanced our
OPERATIONS REVIEW
Aluminum Extrusions
Aluminum Extrusions (or Bonnell Aluminum) produces high-quality, soft-alloy and medium-strength custom fabricated and finished aluminum extrusions primarily for the following markets: building and construction (“B&C”), automotive, and specialty (which consists of consumer durables, machinery and equipment, electrical and renewable energy, and distribution end-use products). A summary of results for Aluminum Extrusions is provided below:
|
|
Three Months Ended |
|
Favorable/ |
|||||||
(In thousands, except percentages) |
|
March 31, |
|
(Unfavorable) |
|||||||
|
|
2025 |
|
|
|
2024 |
|
|
% Change |
||
Sales volume (lbs) |
|
|
37,918 |
|
|
|
33,841 |
|
|
12.0 |
% |
Net sales |
|
$ |
133,635 |
|
|
$ |
114,222 |
|
|
17.0 |
% |
Variable costs |
|
|
103,523 |
|
|
|
84,786 |
|
|
(22.1 |
)% |
Manufacturing fixed costs1 |
|
|
11,214 |
|
|
|
9,625 |
|
|
(16.5 |
)% |
Selling, general and administrative costs1 |
|
|
9,412 |
|
|
|
6,798 |
|
|
(38.5 |
)% |
Other2 |
|
|
326 |
|
|
|
473 |
|
|
31.1 |
% |
EBITDA from ongoing operations |
|
$ |
9,160 |
|
|
$ |
12,540 |
|
|
(27.0 |
)% |
Depreciation & amortization |
|
|
(4,225 |
) |
|
|
(4,542 |
) |
|
7.0 |
% |
EBIT from ongoing operations3 |
|
$ |
4,935 |
|
|
$ |
7,998 |
|
|
(38.3 |
)% |
Capital expenditures |
|
$ |
2,370 |
|
|
$ |
1,550 |
|
|
|
|
1. Excludes related depreciation and amortization. 2. Includes segment allocated employee compensation benefit expenses. 3. For a reconciliation of this non-GAAP measure to the most directly comparable measure calculated in accordance with GAAP, see the EBITDA from ongoing operations by segment statements in the Financial Tables in this press release. |
|||||||||||
The following table presents the sales volume by end use market for the three months March 31, 2025 and 2024, and the three months ended December 31, 2024. |
||||||||||||
|
|
Three Months
|
|
Favorable/ |
|
Three Months
|
|
Favorable/ |
||||
(In millions of lbs) |
|
March 31, |
|
(Unfavorable) |
|
December 31, |
|
(Unfavorable) |
||||
|
2025 |
|
2024 |
|
% Change |
|
2024 |
|
% Change |
|||
Sales volume by end-use market: |
|
|
|
|
|
|
||||||
Non-residential B&C |
|
19.2 |
|
20.1 |
|
(4.5 |
)% |
|
18.2 |
|
5.5 |
% |
Residential B&C |
|
2.0 |
|
1.6 |
|
25.0 |
% |
|
2.4 |
|
(16.7 |
)% |
Automotive |
|
3.1 |
|
3.2 |
|
(3.1 |
)% |
|
2.6 |
|
19.2 |
% |
Specialty products |
|
13.6 |
|
8.9 |
|
52.8 |
% |
|
12.6 |
|
7.9 |
% |
Total |
|
37.9 |
|
33.8 |
|
12.0 |
% |
|
35.8 |
|
5.9 |
% |
First quarter 2025 Results vs. First quarter 2024 Results
Net sales (sales less freight) in the first quarter of 2025 increased
Net new orders increased
Open orders at the end of the first quarter of 2025 were 25 million pounds, which is up from 15 million pounds at the end of the first quarter of 2024 and 17 million pounds at the end of the fourth quarter of 2024 and is the highest level in the last two years. This level falls within the quarterly range of 21 to 27 million pounds in 2019 before pandemic-related disruptions that resulted in long lead times.
On February 10, 2025, the Section 232 tariffs on all aluminum imports were increased from
EBITDA from ongoing operations in the first quarter of 2025 decreased
-
Flat contribution margin (net sales less variable costs) associated with:
-
Lower spread (the difference between selling prices and metal costs) associated with a shift in sales mix (
$2.4 million $0.7 million $0.6 million $0.6 million $0.7 million $1.0 million $0.2 million $3.4 million -
The timing of the flow-through under the first-in first-out (“FIFO”) method of aluminum raw materials costs, which were previously acquired in a quickly changing commodity pricing environment, causing a temporary mismatch in the change in the cost of raw materials included in variable costs and the pass through to customers included in sales, resulted in a benefit of
$1.7 million $1.3 million
-
Lower spread (the difference between selling prices and metal costs) associated with a shift in sales mix (
-
Higher fixed costs associated with wage increases and added resources to support increasing volume (
$1.0 million -
Higher selling, general and administrative ("SG&A") expenses of
$2.6 million $1.7 million $0.3 million $0.4 million
Refer to Item 3. Quantitative and Qualitative Disclosures About Market Risk in the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2025 (“First Quarter Form 10-Q”) for additional information on aluminum price trends.
Projected Capital Expenditures and Depreciation & Amortization
Capital expenditures for Bonnell Aluminum are projected to be
PE Films
PE Films produces surface protection films, polyethylene overwrap films and films for other markets. A summary of results for PE Films is provided below:
|
|
Three Months Ended |
|
Favorable/ |
|||||||
(In thousands, except percentages) |
|
March 31, |
|
(Unfavorable) |
|||||||
|
|
2025 |
|
|
|
2024 |
|
|
% Change |
||
Sales volume (lbs) |
|
|
9,639 |
|
|
|
10,036 |
|
|
(4.0 |
)% |
Net sales |
|
$ |
25,537 |
|
|
$ |
24,735 |
|
|
3.2 |
% |
Variable costs |
|
|
11,977 |
|
|
|
12,024 |
|
|
0.4 |
% |
Manufacturing fixed costs1 |
|
|
3,459 |
|
|
|
3,243 |
|
|
(6.7 |
)% |
Selling, general and administrative costs1 |
|
|
2,592 |
|
|
|
2,516 |
|
|
(3.0 |
)% |
Other2 |
|
|
(11 |
) |
|
|
48 |
|
|
122.9 |
% |
EBITDA from ongoing operations |
|
$ |
7,520 |
|
|
$ |
6,904 |
|
|
8.9 |
% |
Depreciation & amortization |
|
|
(1,250 |
) |
|
|
(1,329 |
) |
|
5.9 |
% |
EBIT from ongoing operations3 |
|
$ |
6,270 |
|
|
$ |
5,575 |
|
|
12.5 |
% |
Capital expenditures |
|
$ |
587 |
|
|
$ |
394 |
|
|
|
|
1. Excludes related depreciation and amortization. 2. Includes segment allocated employee compensation benefit expenses. 3. For a reconciliation of this non-GAAP measure to the most directly comparable measure calculated in accordance with GAAP, see the EBITDA from ongoing operations by segment statements in the Financial Tables in this press release. |
|||||||||||
First quarter 2025 Results vs. First quarter 2024 Results
Net sales in the first quarter of 2025 increased
EBITDA from ongoing operations in the first quarter of 2025 increased
-
Higher contribution margin of
$0.9 million -
A
$1.5 million $0.7 million $0.8 million -
A
$0.7 million $0.5 million $0.1 million
-
A
There have been significant cyclical swings in the sales volume and EBITDA from ongoing operations for PE Films in the last three years, largely due to the unprecedented downturn in the display industry during the second half of 2022 and first half of 2023. EBITDA from ongoing operations for the past 3.25 years (first quarter of 2025, full year 2024, 2023 and 2022) has averaged approximately
Refer to Item 3. Quantitative and Qualitative Disclosures About Market Risk in the First Quarter Form 10-Q for additional information on resin price trends.
Projected Capital Expenditures and Depreciation & Amortization
Capital expenditures for PE Films are projected to be
Corporate Expenses, Interest, Taxes and Other
Corporate expenses, net in the first three months of 2025 increased
Interest expense was
The effective tax rate used to compute income taxes (benefit) from continuing operations in the first three months of 2025 was
Debt, Financial Leverage, Debt Covenants and Debt Refinancing
Total debt was
Total debt decreased
As of March 31, 2025, the Company was in compliance with all covenants under its
On May 6, 2025, the Company entered into Amendment No. 5 ("Amended ABL Facility") to the Second Amended and Restated Credit Agreement, which was due to expire on June 30, 2026. The Amended ABL Facility is a
FORWARD-LOOKING AND CAUTIONARY STATEMENTS
Some of the information contained in this press release may constitute “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. When the Company uses the words “believe,” “estimate,” “anticipate,” “appear to,” “expect,” “project,” “plan,” “likely,” “may” and similar expressions, it does so to identify forward-looking statements. Such statements are based on the Company's then current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. It is possible that the Company's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these forward-looking statements. Factors that could cause actual results to differ materially from expectations include, without limitation, the following:
- the impact of macroeconomic factors, such as inflation, interest rates and recession risks;
- an increase in the operating costs incurred by the Company’s business units, including, for example, the cost of raw materials and energy;
- noncompliance with any of the financial and other restrictive covenants in the ABL Facility;
- failure to continue to attract, develop and retain certain key officers or employees;
- disruptions to the Company’s manufacturing facilities, including those resulting from labor shortages;
- an information technology system failure or breach;
-
risks of doing business in countries outside the
U.S. that affect our international operations; - the impact of public health epidemics on employees, production and the global economy, such as the COVID-19 pandemic;
- political, economic and regulatory factors concerning the Company’s products;
- inability to develop, efficiently manufacture and deliver new products at competitive prices;
- the impact of the imposition of tariffs and sanctions on imported aluminum ingot used by Bonnell Aluminum;
- failure by governmental entities to prevent foreign companies from evading antidumping and countervailing duties;
- unanticipated problems or delays with the implementation of the enterprise resource planning and manufacturing executions systems, or security breaches and other disruptions to the Company's information technology infrastructure;
- loss of sales to significant customers on which the Company’s business is highly dependent;
- inability to achieve sales to new customers to replace lost business;
- failure of the Company’s customers to achieve success or maintain market share;
- failure to protect our intellectual property rights;
- inability to successfully complete strategic acquisitions or dispositions, failure to realize the expected benefits of such acquisitions or dispositions, and assumption of unanticipated risks in such acquisitions or dispositions;
and the other factors discussed in the reports Tredegar files with or furnishes to the Securities and Exchange Commission (the “SEC”) from time to time, including the risks and important factors set forth in additional detail in Part I, Item 1A. Risk Factors of the Company’s Form 10-K for the year ended December 31, 2024. Readers are urged to review and consider carefully the disclosures Tredegar makes in its filings with the SEC.
Tredegar does not undertake, and expressly disclaims any duty, to update any forward-looking statement made in this press release to reflect any change in management’s expectations or any change in conditions, assumptions or circumstances on which such statements are based, except as required by applicable law.
To the extent that the financial information portion of this press release contains non-GAAP financial measures, it also presents both the most directly comparable financial measures calculated and presented in accordance with GAAP and a quantitative reconciliation of the difference between any such non-GAAP measures and such comparable GAAP financial measures. Reconciliations of non-GAAP financial measures are provided in the Notes to the Financial Tables included with this press release and can also be found within “Presentations” in the “Investors” section of our website, www.tredegar.com.
Tredegar uses its website as a channel of distribution of material company information. Financial information and other material information regarding Tredegar is posted on and assembled in the “Investors” section of its website.
Tredegar Corporation is an industrial manufacturer with two primary businesses: custom aluminum extrusions for the North American building & construction, automotive and specialty end-use markets and surface protection films for high-technology applications in the global electronics industry. With approximately 1,500 employees, the Company operates manufacturing facilities in
Tredegar Corporation |
|||||||
Condensed Consolidated Statements of Income |
|||||||
(In Thousands, Except Per-Share Data) |
|||||||
(Unaudited) |
|||||||
|
|
|
|||||
|
|
Three Months Ended |
|||||
|
|
March 31, |
|||||
|
|
|
2025 |
|
|
|
2024 |
Sales |
|
$ |
164,738 |
|
|
$ |
143,972 |
Other income (expense), net (c) |
|
|
(10 |
) |
|
|
6 |
|
|
|
164,728 |
|
|
|
143,978 |
|
|
|
|
|
|||
Cost of goods sold (c) |
|
|
135,643 |
|
|
|
115,106 |
Freight |
|
|
5,566 |
|
|
|
5,015 |
Selling, R&D and general expenses (c) |
|
|
20,825 |
|
|
|
16,684 |
Amortization of identifiable intangibles |
|
|
440 |
|
|
|
440 |
Pension and postretirement benefits |
|
|
(25 |
) |
|
|
54 |
Interest expense |
|
|
1,013 |
|
|
|
1,184 |
Asset impairments and costs associated with exit and disposal activities, net of adjustments (c) |
|
|
18 |
|
|
|
507 |
|
|
|
163,480 |
|
|
|
138,990 |
Income (loss) from continuing operations before income taxes |
|
|
1,248 |
|
|
|
4,988 |
Income tax expense (benefit) |
|
|
577 |
|
|
|
2,384 |
Net income (loss) from continuing operations |
|
|
671 |
|
|
|
2,604 |
Income (loss) from discontinued operations, net of tax |
|
|
9,430 |
|
|
|
684 |
Net income (loss) |
|
$ |
10,101 |
|
|
$ |
3,288 |
|
|
|
|
|
|||
Earnings (loss) per share: |
|
|
|
|
|||
Basic: |
|
|
|
|
|||
Continuing operations |
|
$ |
0.02 |
|
|
$ |
0.08 |
Discontinued operations |
|
|
0.27 |
|
|
|
0.02 |
Basic earnings (loss) per share |
|
$ |
0.29 |
|
|
$ |
0.10 |
Diluted: |
|
|
|
|
|||
Continuing operations |
|
$ |
0.02 |
|
|
$ |
0.08 |
Discontinued operations |
|
|
0.27 |
|
|
|
0.02 |
Diluted earnings (loss) per share |
|
$ |
0.29 |
|
|
$ |
0.10 |
|
|
|
|
|
|||
Shares used to compute earnings (loss) per share: |
|
|
|
|
|||
Basic |
|
|
34,612 |
|
|
|
34,323 |
Diluted |
|
|
34,612 |
|
|
|
34,323 |
Tredegar Corporation |
||||||||
Net Sales and EBITDA from Ongoing Operations by Segment |
||||||||
(In Thousands) |
||||||||
(Unaudited) |
||||||||
|
|
|
||||||
|
|
Three Months Ended |
||||||
|
|
March 31, |
||||||
|
|
|
2025 |
|
|
|
2024 |
|
Net Sales |
|
|
|
|
||||
Aluminum Extrusions |
|
$ |
133,635 |
|
|
$ |
114,222 |
|
PE Films |
|
|
25,537 |
|
|
|
24,735 |
|
Total net sales |
|
|
159,172 |
|
|
|
138,957 |
|
Add back freight |
|
|
5,566 |
|
|
|
5,015 |
|
Sales as shown in the condensed consolidated statements of income |
|
$ |
164,738 |
|
|
$ |
143,972 |
|
|
|
|
|
|
||||
EBITDA from Ongoing Operations (f) |
|
|
|
|
||||
Aluminum Extrusions: |
|
|
|
|
||||
Ongoing operations: |
|
|
|
|
||||
EBITDA (b) |
|
$ |
9,160 |
|
|
$ |
12,540 |
|
Depreciation & amortization |
|
|
(4,225 |
) |
|
|
(4,542 |
) |
EBIT (b) |
|
|
4,935 |
|
|
|
7,998 |
|
Plant shutdowns, asset impairments, restructurings and other (c) |
|
|
(1,167 |
) |
|
|
(1,167 |
) |
PE Films: |
|
|
|
|
||||
Ongoing operations: |
|
|
|
|
||||
EBITDA (b) |
|
$ |
7,520 |
|
|
$ |
6,904 |
|
Depreciation & amortization |
|
|
(1,250 |
) |
|
|
(1,329 |
) |
EBIT (b) |
|
|
6,270 |
|
|
|
5,575 |
|
Plant shutdowns, asset impairments, restructurings and other (c) |
|
|
— |
|
|
|
(504 |
) |
Total |
|
|
10,038 |
|
|
|
11,902 |
|
Interest income |
|
|
5 |
|
|
|
20 |
|
Interest expense |
|
|
1,013 |
|
|
|
1,184 |
|
Corporate expenses, net (c) |
|
|
7,782 |
|
|
|
5,750 |
|
Income (loss) from continuing operations before income taxes |
|
|
1,248 |
|
|
|
4,988 |
|
Income tax expense (benefit) |
|
|
577 |
|
|
|
2,384 |
|
Net income (loss) from continuing operations |
|
|
671 |
|
|
|
2,604 |
|
Income (loss) from discontinued operations, net of tax |
|
|
9,430 |
|
|
|
684 |
|
Net income (loss) |
|
$ |
10,101 |
|
|
$ |
3,288 |
|
Tredegar Corporation |
||||||
Condensed Consolidated Balance Sheets |
||||||
(In Thousands) |
||||||
(Unaudited) |
||||||
|
|
|
|
|
||
|
|
March 31, 2025 |
|
December 31, 2024 |
||
Assets |
|
|
|
|
||
Cash & cash equivalents |
|
$ |
3,657 |
|
$ |
7,062 |
Accounts & other receivables, net |
|
|
79,749 |
|
|
64,817 |
Income taxes recoverable |
|
|
301 |
|
|
— |
Inventories |
|
|
68,895 |
|
|
51,381 |
Prepaid expenses & other |
|
|
9,125 |
|
|
16,567 |
Total current assets |
|
|
161,727 |
|
|
139,827 |
Property, plant & equipment, net |
|
|
134,535 |
|
|
137,032 |
Right-of-use leased assets |
|
|
14,267 |
|
|
14,635 |
Identifiable intangible assets, net |
|
|
6,887 |
|
|
7,326 |
Goodwill |
|
|
22,446 |
|
|
22,446 |
Deferred income taxes |
|
|
32,330 |
|
|
32,517 |
Other assets |
|
|
2,025 |
|
|
2,448 |
Non-current assets of discontinued operations |
|
|
— |
|
|
126 |
Total assets |
|
$ |
374,217 |
|
$ |
356,357 |
Liabilities and Shareholders’ Equity |
|
|
|
|
||
Accounts payable |
|
$ |
83,190 |
|
$ |
64,704 |
Accrued expenses |
|
|
16,960 |
|
|
22,168 |
Lease liability, short-term |
|
|
2,476 |
|
|
2,453 |
Short-term debt |
|
|
627 |
|
|
1,322 |
Income taxes payable |
|
|
550 |
|
|
320 |
Current liabilities of discontinued operations |
|
|
— |
|
|
741 |
Total current liabilities |
|
|
103,803 |
|
|
91,708 |
Lease liability, long-term |
|
|
12,514 |
|
|
12,993 |
ABL revolving facility |
|
|
56,000 |
|
|
60,600 |
Pension and other postretirement benefit obligations, net |
|
|
5,870 |
|
|
5,914 |
Deferred income taxes |
|
|
69 |
|
|
69 |
Other non-current liabilities |
|
|
4,591 |
|
|
4,105 |
Shareholders’ equity |
|
|
191,370 |
|
|
180,968 |
Total liabilities and shareholders’ equity |
|
$ |
374,217 |
|
$ |
356,357 |
Tredegar Corporation |
||||||||
Condensed Consolidated Statements of Cash Flows |
||||||||
(In Thousands) |
||||||||
(Unaudited) |
||||||||
|
|
|
||||||
|
|
Three Months Ended March 31, |
||||||
|
|
|
2025 |
|
|
|
2024 |
|
Cash flows from operating activities: |
|
|
|
|
||||
Net income (loss) |
|
$ |
10,101 |
|
|
$ |
3,288 |
|
Adjustments for noncash items: |
|
|
|
|
||||
Depreciation |
|
|
5,086 |
|
|
|
6,252 |
|
Amortization of intangibles |
|
|
440 |
|
|
|
464 |
|
Reduction of right-of-use assets |
|
|
529 |
|
|
|
610 |
|
Deferred income taxes |
|
|
407 |
|
|
|
623 |
|
Accrued pension and postretirement benefits |
|
|
80 |
|
|
|
54 |
|
Stock-based compensation expense |
|
|
472 |
|
|
|
686 |
|
(Gain) loss on sale of divested business |
|
|
(9,657 |
) |
|
|
— |
|
Changes in assets and liabilities: |
|
|
|
|
||||
Accounts and other receivables |
|
|
(14,931 |
) |
|
|
(5,337 |
) |
Inventories |
|
|
(17,513 |
) |
|
|
(5,481 |
) |
Income taxes recoverable/payable |
|
|
(71 |
) |
|
|
(580 |
) |
Prepaid expenses and other |
|
|
7,174 |
|
|
|
1,890 |
|
Accounts payable and accrued expenses |
|
|
12,687 |
|
|
|
(10,306 |
) |
Lease liability |
|
|
(616 |
) |
|
|
(689 |
) |
Pension and postretirement benefit plan contributions |
|
|
(152 |
) |
|
|
(158 |
) |
Other, net |
|
|
958 |
|
|
|
965 |
|
Net cash provided by (used in) operating activities |
|
|
(5,006 |
) |
|
|
(7,719 |
) |
Cash flows from investing activities: |
|
|
|
|
||||
Capital expenditures |
|
|
(2,957 |
) |
|
|
(2,461 |
) |
Proceeds from the sale of Terphane |
|
|
9,835 |
|
|
|
— |
|
Proceeds from the sale of assets |
|
|
— |
|
|
|
83 |
|
Net cash provided by (used in) investing activities |
|
|
6,878 |
|
|
|
(2,378 |
) |
Cash flows from financing activities: |
|
|
|
|
||||
Borrowings |
|
|
33,750 |
|
|
|
179,248 |
|
Debt principal payments |
|
|
(39,047 |
) |
|
|
(177,240 |
) |
Net cash provided by (used in) financing activities |
|
|
(5,297 |
) |
|
|
2,008 |
|
Effect of exchange rate changes on cash |
|
|
20 |
|
|
|
(574 |
) |
Increase (decrease) in cash and cash equivalents |
|
|
(3,405 |
) |
|
|
(8,663 |
) |
Cash and cash equivalents at beginning of period |
|
|
7,062 |
|
|
|
13,455 |
|
Cash and cash equivalents at end of period |
|
$ |
3,657 |
|
|
$ |
4,792 |
|
Notes to the Financial Tables (Unaudited) |
||
(a) |
Tredegar’s presentation of net income (loss) and diluted earnings (loss) per share from ongoing operations are non-GAAP financial measures that exclude the effects of gains or losses associated with plant shutdowns, asset impairments and restructurings, gains or losses from the sale of assets, goodwill impairment charges, discontinued operations, net periodic benefit cost for the frozen defined benefit pension plan prior to termination and other items (which includes gains and losses for an investment accounted for under the fair value method) which have been presented separately and removed from net income (loss) from continuing operations and diluted earnings (loss) per share as reported under GAAP. Net income (loss) and diluted earnings (loss) per share from ongoing operations are key financial and analytical measures used by management to gauge the operating performance of Tredegar’s ongoing operations. They are not intended to represent the stand-alone results for Tredegar’s ongoing operations under GAAP and should not be considered as an alternative to net income (loss) from continuing operations or earnings (loss) per share as defined by GAAP. They exclude items that management believes do not relate to Tredegar’s ongoing operations. A reconciliation to net income (loss) and diluted earnings (loss) per share from ongoing operations for the three months ended March 31, 2025 and 2024 is shown below: |
|
|
|
Three Months Ended March 31, |
||||
(In millions, except per share data) |
|
|
2025 |
|
|
2024 |
Net income (loss) from continuing operations as reported under GAAP1 |
|
$ |
0.7 |
|
$ |
2.6 |
After-tax effects of: |
|
|
|
|
||
(Gains) losses associated with plant shutdowns, asset impairments and restructurings |
|
|
— |
|
|
0.4 |
(Gains) losses from sale of assets and other: |
|
|
|
|
||
Other |
|
|
2.9 |
|
|
1.7 |
Net income (loss) from ongoing operations1 |
|
$ |
3.6 |
|
$ |
4.7 |
|
|
|
|
|
||
Earnings (loss) from continuing operations per share as reported under GAAP (diluted) |
|
$ |
0.02 |
|
$ |
0.08 |
After-tax effects per diluted share of: |
|
|
|
|
||
(Gains) losses associated with plant shutdowns, asset impairments and restructurings |
|
|
— |
|
|
0.01 |
(Gains) losses from sale of assets and other: |
|
|
|
|
||
Other |
|
|
0.08 |
|
|
0.05 |
Earnings (loss) per share from ongoing operations (diluted) |
|
$ |
0.10 |
|
$ |
0.14 |
1. Reconciliations of the pre-tax and post-tax balances attributed to net income (loss) are shown in Note (d). |
||||||
(b) |
EBITDA (earnings before interest, taxes, depreciation and amortization) from ongoing operations is the key segment profitability metric used by the Company’s chief operating decision maker (“CODM”) to assess segment financial performance. The Company uses sales less freight (“net sales”) as its measure of revenues from external customers at the segment level. For more business segment information, see Note 9 to the Company’s Condensed Consolidated Financial Statements in the First Quarter Form 10-Q. |
|
EBIT (earnings before interest and taxes) from ongoing operations is a non-GAAP financial measure included in the accompanying tables and the reconciliation of segment financial information to consolidated results for the Company in the net sales and EBITDA from ongoing operations by segment statements. It is not intended to represent the stand-alone results for Tredegar’s ongoing operations under GAAP and should not be considered as an alternative to net income (loss) as defined by GAAP. The Company believes that EBIT is a widely understood and utilized metric that is meaningful to certain investors and that including this financial metric in the reconciliation of management’s performance metric, EBITDA from ongoing operations, provides useful information to those investors that primarily utilize EBIT to analyze the Company’s core operations. |
||
(c) |
Gains and losses associated with plant shutdowns, asset impairments, restructurings and other items for the three months ended March 31, 2025 and 2024 detailed below are shown in the statements of net sales and EBITDA from ongoing operations by segment and are included in “Asset impairments and costs associated with exit and disposal activities, net of adjustments” in the condensed consolidated statements of income, unless otherwise noted. |
|
Three Months Ended
|
|||||
(In millions) |
Pre-Tax |
Net of Tax |
||||
Aluminum Extrusions: |
|
|
||||
(Gains) losses from sale of assets, investment writedowns and other items: |
|
|
||||
Consulting expenses for ERP/MES project1 |
$ |
0.4 |
|
$ |
0.3 |
|
Legal fees associated with the Aluminum Extruders Trade Case and other matters1 |
|
0.3 |
|
|
0.3 |
|
Aluminum premium charge as a result of unplanned maintenance interruptions2 |
|
0.3 |
|
|
0.2 |
|
Total for Aluminum Extrusions |
$ |
1.0 |
|
$ |
0.8 |
|
Corporate: |
|
|
||||
(Gain) losses from sale of assets, investment writedowns and other items: |
|
|
||||
Professional fees associated with business development activities1 |
$ |
2.5 |
|
$ |
2.0 |
|
Professional fees associated with remediation activities related to internal control over financial reporting1 |
|
0.2 |
|
|
0.1 |
|
Group annuity contract premium adjustment3 |
|
0.1 |
|
|
— |
|
Professional fees associated with the transition to the ABL Facility1 |
|
0.1 |
|
|
0.1 |
|
Initial installment proceeds on the sale of corporate-owned land3 |
|
(0.1 |
) |
|
(0.1 |
) |
Total for Corporate |
$ |
2.8 |
|
$ |
2.1 |
|
1. Included in “Selling, R&D and general expenses” in the condensed consolidated statements of income. 2. Included in “Cost of Goods Sold” in the condensed consolidated statements of income. 3. Included in “Other income (expense), net” in the condensed consolidated statements of income. |
||||||
|
Three Months Ended
|
|||
(In millions) |
Pre-Tax |
Net of Tax |
||
Aluminum Extrusions: |
|
|
||
(Gains) losses from sale of assets, investment writedowns and other items: |
|
|
||
Consulting expenses for ERP/MES project1 |
$ |
0.6 |
$ |
0.4 |
Storm damage to the |
|
0.1 |
|
0.1 |
Legal fees associated with the Aluminum Extruders Trade Case1 |
|
0.2 |
|
0.2 |
Total for Aluminum Extrusions |
$ |
0.9 |
$ |
0.7 |
PE Films: |
|
|
||
(Gains) losses associated with plant shutdowns, asset impairments and restructurings: |
|
|
||
|
$ |
0.2 |
$ |
0.1 |
|
|
0.3 |
|
0.3 |
Total for PE Films |
$ |
0.5 |
$ |
0.4 |
Corporate: |
|
|
||
(Gain) losses from sale of assets, investment writedowns and other items: |
|
|
||
Professional fees associated with business development activities1 |
$ |
0.2 |
$ |
0.2 |
Professional fees associated with remediation activities related to internal control over financial reporting1 |
|
0.9 |
|
0.7 |
Professional fees associated with the transition to the ABL Facility1 |
|
0.2 |
|
0.1 |
Total for Corporate |
$ |
1.3 |
$ |
1.0 |
1. Included in “Selling, R&D and general expenses” in the condensed consolidated statements of income. 2. For more information, see Note (g). |
||||
(d) |
For discussion on Tredegar’s presentation of net income (loss) from ongoing operations, please refer to Note (a) above. Reconciliations of the pre-tax and post-tax balances attributed to net income (loss) from ongoing operations for the three months ended March 31, 2025 and 2024 and are shown below in order to show the impact on the effective tax rate: |
(In millions) |
Pre-Tax |
|
Taxes Expense (Benefit) |
|
After-Tax |
|
Effective Tax Rate |
||||
Three Months Ended March 31, 2025 |
(a) |
|
(b) |
|
|
|
(b)/(a) |
||||
Net income (loss) from continuing operations as reported under GAAP |
$ |
1.2 |
|
$ |
0.5 |
|
$ |
0.7 |
|
46.2 |
% |
(Gains) losses from sale of assets and other |
|
3.8 |
|
|
0.9 |
|
|
2.9 |
|
|
|
Net income (loss) from ongoing operations |
$ |
5.0 |
|
$ |
1.4 |
|
$ |
3.6 |
|
28.0 |
% |
Three Months Ended March 31, 2024 |
|
|
|
|
|
|
|
||||
Net income (loss) from continuing operations as reported under GAAP |
$ |
5.0 |
|
$ |
2.4 |
|
$ |
2.6 |
|
47.8 |
% |
(Gains) losses associated with plant shutdowns, asset impairments and restructurings |
|
0.5 |
|
|
0.1 |
|
|
0.4 |
|
|
|
(Gains) losses from sale of assets and other |
|
2.2 |
|
|
0.5 |
|
|
1.7 |
|
|
|
Net income (loss) from ongoing operations |
$ |
7.7 |
|
$ |
3.0 |
|
$ |
4.7 |
|
39.0 |
% |
(e) Net debt is calculated as follows: |
(In millions) |
|
March 31, |
|
December 31, |
||
|
|
2025 |
|
|
2024 |
|
Short-term debt |
|
$ |
0.6 |
|
$ |
1.3 |
ABL revolving facility |
|
|
56.0 |
|
|
60.6 |
Total debt |
|
|
56.6 |
|
|
61.9 |
Less: Cash and cash equivalents |
|
|
3.7 |
|
|
7.1 |
Net debt |
|
$ |
52.9 |
|
$ |
54.8 |
Net debt is not intended to represent total debt as defined by GAAP. Net debt is utilized by management in evaluating the Company’s financial leverage and equity valuation, and management believes that investors also may find net debt to be helpful for the same purposes.
Net leverage ratio is a non-GAAP financial measure. It is not intended to represent the stand-alone results for Tredegar under GAAP and should not be considered as an alternative to net income (loss) and total debt as defined by GAAP. Net leverage ratio is utilized by management in evaluating the Company’s financial leverage, and management believes that investors also may find the net leverage ratio to be helpful for the same purposes. In addition, earnings before interest, taxes, depreciation and amortization as defined in the ABL Facility ("Credit EBITDA") is provided below. |
||||||
|
As of or for Twelve Months Ended March 31, 2025(1) |
($ in millions) |
|
Net debt |
52.9 |
Credit EBITDA(2) |
47.8 |
Net leverage ratio |
1.1 |
|
|
| (f) Tredegar’s presentation of Consolidated EBITDA from ongoing operations is a non-GAAP financial measure that excludes the effects of gains or losses associated with plant shutdowns, asset impairments and restructurings, gains or losses from the sale of assets, goodwill impairment charges, discontinued operations, net periodic benefit cost for the frozen defined benefit pension plan and other items (which includes gains and losses for an investment accounted for under the fair value method). Consolidated EBITDA from ongoing operations also excludes depreciation & amortization, stock option-based compensation costs, interest and income taxes. Consolidated EBITDA is a key financial and analytical measure used by management to gauge the operating performance of Tredegar’s ongoing operations. It is not intended to represent the stand-alone results for Tredegar’s ongoing operations under GAAP and should not be considered as an alternative to net income (loss) or earnings (loss) per share as defined by GAAP. It excludes items that management believes do not relate to Tredegar’s ongoing operations. A reconciliation of Consolidated EBITDA from ongoing operations for the three months ended March 31, 2025 and 2024 is shown below: |
|
Three Months Ended March 31, |
||||
($ in millions) |
|
2025 |
|
|
2024 |
Net income (loss) from continuing operations as reported under GAAP1 |
$ |
0.7 |
|
$ |
2.6 |
After-tax effects of: |
|
|
|
||
(Gains) losses associated with plant shutdowns, asset impairments and restructurings |
|
— |
|
|
0.4 |
(Gains) losses from sale of assets and other |
|
2.9 |
|
|
1.7 |
Net income (loss) from ongoing operations1 |
|
3.6 |
|
|
4.7 |
Depreciation and amortization |
|
5.5 |
|
|
6.0 |
Interest expense |
|
1.0 |
|
|
1.2 |
Income taxes from ongoing operations1 |
|
1.4 |
|
|
3.0 |
Consolidated EBITDA from ongoing operations |
$ |
11.5 |
|
$ |
14.9 |
1. Reconciliations of the pre-tax and post-tax balances attributed to net income (loss) from continuing operations are shown in Note (d). |
|||||
(g) |
In August 2023, the Company adopted a plan to close the PE Films technical center in |
|
|
||
(h) |
The computation of Credit EBITDA, as defined in the ABL Facility, is presented below. |
Computations of Credit EBITDA (as defined in the ABL Facility) as of and for the Twelve Months Ended March 31, 2025 * |
|||
Computations of Credit EBITDA for the twelve months ended March 31, 2025 (in thousands): |
|||
Net income (loss) |
$ |
(57,752 |
) |
Plus: |
|
||
After-tax losses related to discontinued operations |
|
56,864 |
|
Total income tax expense for continuing operations |
|
— |
|
Interest expense |
|
4,493 |
|
Depreciation and amortization expense for continuing operations |
|
22,784 |
|
All non-cash losses and expenses, plus cash losses and expenses not to exceed |
|
23,389 |
|
Charges related to stock option grants and awards accounted for under the fair value-based method |
|
— |
|
Losses related to the application of the equity method of accounting |
|
— |
|
Losses related to adjustments in the estimated fair value of assets accounted for under the fair value method of accounting |
|
— |
|
Fees, costs and expenses incurred in connection with the amendment process |
|
355 |
|
Terphane sale transaction costs in an amount not to exceed |
|
— |
|
Minus: |
|
||
After-tax income related to discontinued operations |
|
— |
|
Total income tax benefits for continuing operations |
|
(1,972 |
) |
Interest income |
|
(21 |
) |
All non-cash gains and income, plus cash gains and income in excess of |
|
— |
|
Income related to changes in estimates for stock option grants and awards accounted for under the fair value-based method |
|
— |
|
Income related to the application of the equity method of accounting |
|
— |
|
Income related to adjustments in the estimated fair value of assets accounted for under the fair value method of accounting |
|
(144 |
) |
Plus cash dividends declared on investments in an amount not to exceed |
|
— |
|
Plus or minus, as applicable, pro forma EBITDA adjustments associated with acquisitions and asset dispositions |
|
— |
|
Plus or minus, as applicable, pro forma EBITDA adjustments to pension expense associated with the early payment of pension obligations |
|
(181 |
) |
Credit EBITDA |
$ |
47,815 |
|
Fixed charge coverage ratio**: |
|
||
Credit EBITDA |
$ |
47,815 |
|
Unfinanced capital expenditures |
$ |
12,871 |
|
Fixed charges |
$ |
5,424 |
|
Fixed charge coverage ratio |
|
6.44 |
|
* Credit EBITDA is not intended to represent net income (loss) or cash flow from operations as defined by GAAP and should not be considered as an alternative to either net income (loss) or to cash flow. ** Fixed Charge Coverage Ratio is computed as the ratio of (a) Credit EBITDA minus Unfinanced Capital Expenditures to (b) Fixed Charges. |
|||
View source version on businesswire.com: https://www.businesswire.com/news/home/20250508924876/en/
Tredegar Corporation
Neill Bellamy, 804-330-1211
Source: Tredegar Corporation
