FiberMark posts $5.82 million second-quarter operating income

By Caroline Salls

Pittsburgh, Aug. 12 - FiberMark, Inc. reported $5.82 million in operating income for the second quarter compared to $6.36 million for the same period in 2004, according to a company news release.

There was a net loss of $1.4 million for the second quarter ended June 30, versus net income of $0.6 million for the second quarter of 2004.

The change in net loss was largely due to higher raw material, energy and manufacturing costs and higher depreciation expenses, partially offset by lower selling and administrative expenses due to lower information technology maintenance costs and professional services, a $1.9 million asset disposal gain due to the sale of an idle facility, price increases, improvements in product mix and lower fixed costs, the release said.

Net sales in the second quarter of 2005 were $115.6 million compared with $111.0 million in the prior-year quarter.

Second-quarter 2005 net sales from North American operations were $58.2 million compared with $58.4 million in the prior-year quarter.

For the six months ended June 30, the company reported $14.3 million in operating income, compared to $15.52 million for the first six months of 2004.

For the first six months of 2005, the company showed a net loss of $3.7 million compared with a net loss of $16.3 million in the first half of 2004.

The $12.6 million reduction in net loss was primarily due to lower interest expense ($8.5 million lower), largely due to the cessation of interest expense accruals on the senior notes pending the outcome of the bankruptcy process and lower reorganization expenses related to Chapter 11 ($5.3 million lower), offset by lower income from operations ($1.2 million lower), the release said.

Lower income from operations reflects lower expenses ($1.6 million decrease) and a $1.9 million gain on disposal of assets.

Consolidated net sales for the six months ended June 30 were $230.4 million compared with $223.4 million in 2004.

FiberMark, a Brattleboro, Vt., producer of specialty fiber-based materials, filed for bankruptcy on March 30, 2004. Its Chapter 11 case number is 04-10463.

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