Tredegar Reports Second Quarter 2023 Results

Second quarter 2023 net income (loss) was $(18.9) million ($(0.56) per diluted share) compared to net income (loss) of $14.9 million ($0.44 per diluted share) in the second quarter of 2022. Net income (loss) from ongoing operations, which excludes special items, was $(2.0) million ($(0.06) per diluted share) in the second quarter of 2023 compared with $17.2 million ($0.51 per diluted share) in the second quarter of 2022. A reconciliation of net income (loss), a financial measure calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), to net income (loss) from ongoing operations, a non-GAAP financial measure, for the three and six months ended June 30, 2023 and 2022, is provided in Note (a) to the Financial Tables in this press release.

Second Quarter Financial Results Highlights
*Earnings before interest, taxes, depreciation and amortization (“EBITDA”) from ongoing operations for Aluminum Extrusions was $10.2 million in the second quarter of 2023 versus $21.9 million in the second quarter of last year. EBITDA from ongoing operations during the last four quarters has been weak, in a range of $8.9 to $14.6 million.
*Sales volume of 35.5 million pounds in the second quarter of 2023 was relatively consistent with the first quarter of 2023 and the fourth quarter of 2022 but declined significantly versus 49.0 million pounds in the second quarter of last year.
*Open orders at the end of the second quarter of 2023 were 20 million pounds (versus 27 million pounds at the end of the first quarter of 2023), which is below the quarterly range of 21 to 27 million pounds in 2019 before pandemic-related disruptions that resulted in excessive open orders, which peaked in the first quarter of 2022 at approximately 100 million pounds.
*While open orders have declined over the past year, Aluminum Extrusions has realized three sequential quarters of net booking growth.
*EBITDA from ongoing operations for PE Films was $0.8 million in the second quarter of 2023 versus $7.1 million in the second quarter of 2022 as very weak conditions persisted in the consumer electronics market. EBITDA from ongoing operations during the last four quarters has been low with a range of negative $2.6 million to positive $1.8 million.
*EBITDA from ongoing operations for Flexible Packaging Films was $0.2 million during the second quarter of 2023 versus $7.6 million in the second quarter of 2022 primarily due to lower sales volume, which the Company believes is mainly due to customer inventory corrections, lower margins and unfavorable cost variances.

John Steitz, Tredegar’s president and chief executive officer, said, “We recognized a loss for the quarter with each of our businesses suffering from depressed conditions in their markets, which we believe can mostly be traced to the residual impact of the pandemic. The timing of a recovery for them remains uncertain. Significant spending controls are in place. Debt, net of cash, declined by $20 million during the quarter from much-needed improvement in working capital. Further working capital improvement is anticipated by year end.”

Mr. Steitz continued, “But what we need most is a recovery in sales, profits and operating cash flow across all business segments, which has been slow in occurring. Meanwhile, we have a pension plan settlement obligation due in the fourth quarter estimated at $30 million. We have suspended our quarterly dividend and recently amended our credit facility to provide some ‘breathing room’. We’re thankful for our dedicated employees who are working hard to help drive a turnaround.”
details at: https://ir.tredegar.com/news-releases/news-release-details/tredegar-reports-second-quarter-2023-results

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