PGI Receives Loan Commitments, Reports Strong Sales
Polymer Group Inc. (PGI), North Charleston, S.C., has received commitments for a new $475 million
syndicated senior bank facility led by Citigroup Global Markets Inc. Proceeds from the new facility
will be used to pay off PGI's current senior secured credit facility, and is expected to
substantially reduce the company's interest costs.
In addition, majority stockholder MatlinPatterson Global Opportunities Partners LP has exchanged $41 million of convertible subordinated notes for shares of preferred stock, with a dividend payment option to issue additional shares of preferred stock rather than pay cash dividends. This transaction also will reduce PGI's overall debt and interest costs.
In other company news, PGI reported first-quarter 2004 financial results, which included net sales of $206.7 million the highest in 11 quarters and 5 percent above year-earlier sales. The company realized a gross profit of $38.5 million for the quarter, up 15.6 percent from the first quarter 2003; and a gross profit margin increase of 18.6 percent from 16.9 percent a year earlier. Operating income of $10.8 million for the quarter was up 18.5 percent over the prior-year period.
"The strong sales we achieved during the first quarter is a result of the momentum we began to build during the second half of 2003," said James L. Schaeffer, CEO. "We continued to improve our operating income through improved manufacturing efficiency combined with increased volume from new business development initiatives. In addition our new line in Mexico was ramping up and is now at full commercial production. "