Sealed Air Reports First Quarter 2015 Results

Sealed Air Corporation announced financial results for first quarter 2015.
 
First quarter 2015 net sales of $1.7 billion decreased 4.4% on a reported basis and increased 3.5% on a constant dollar basis. Favorable product price/mix was 3.2% on relatively flat volume. Currency had a negative impact on net sales of $146 million.
 
The company delivered higher sales across all divisions and regions on a constant dollar basis as compared with the first quarter 2014. Latin America and Japan, Australia and New Zealand were the fastest growing regions, increasing sales by 6.6% and 4.6% on a constant dollar basis, respectively. North America delivered constant dollar net sales growth of 3.1%, Europe increased 3.0% and AMAT was up 2.9%. Additionally, first quarter 2015 net sales from Developing Regions, which accounted for 24.9% of net sales, decreased 4.9% on a reported basis and increased 7.5% in constant dollars compared to last year.
 
“Our first quarter 2015 performance was a strong start to the year despite currency headwinds,” said Jerome A. Peribere, president and CEO. “Net sales of $1.7 billion were up 3.5% on a constant dollar basis as compared to last year with positive sales across all divisions and regions.
 
“Adjusted EBITDA increased more than 13% compared to last year with Adjusted EBITDA margins expanding 260 basis points to 16.3% as a result of favorable price/mix and cost spread and our ongoing commitment to operational excellence,” Peribere added. “For the remainder of the year, we will continue to stay disciplined on our value-added selling approach and focused on earnings quality improvement initiatives, both of which are expected to contribute to organic sales growth and margin expansion.”
 
Food Care net sales of $880 million in the first quarter decreased 2.7% as reported, and increased 5.8% on a constant dollar basis. Currency had a negative impact on Food Care net sales of 8.5%, or $77 million, in the first quarter 2015. Strength across all regions contributed to favorable product price/mix of 3.8% and an increase in volume of 2.0%. Food Care’s Adjusted EBITDA of $191 million or 21.7% of net sales increased 19.8% compared to last year.
 
Diversey Care net sales of $468 million in the first quarter decreased 7.4% as reported, and increased 1.5% on a constant dollar basis. Currency had a negative impact on Diversey Care net sales of 8.9%, or $45 million, in the quarter.
 
Product Care net sales of $377 million in the first quarter decreased 4.2% as reported, and increased approximately 1.1% on a constant dollar basis.
 
First quarter 2015 net earnings on a reported basis were $97.2 million, or $0.46 per diluted share, which included $17.4 million, or $0.08 per diluted share, of special items primarily consisting of restructuring and other associated costs. This compared to first quarter 2014 net earnings on a reported basis of $70.9 million, or $0.33 per diluted share, which included special items of $0.4 million.
 
Adjusted EPS was $0.54 for the first quarter. This compares to Adjusted EPS of $0.33 in the first quarter 2014. Adjusted EBITDA for the first quarter 2015 was $284 million, or 16.3% of net sales, compared to $251 million, or 13.7% of net sales, in first quarter 2014.
 
Cash flow provided by operating activities in the first three months ending 2015 was $319 million. In March 2015, the company received a tax refund of $235 million related to the settlement agreement payment. Excluding the tax refund, cash flow provided by operating activities in the first three months ending 2015 was $84 million.
 
The company estimates net sales to be approximately $7.1 billion for the full year 2015. This forecast assumes an unfavorable impact of approximately 9% from foreign currency translation.