Intertape Polymer foresees debt cuts in 2011 via sales, margin growth

By Jennifer Lanning Drey

Savannah, Ga., March 23 - Intertape Polymer Group Inc. expects to reduce debt during 2011, Greg Yull, its chief executive officer, said during a Wednesday conference call held to discuss the company's fourth-quarter and year-end results.

"Paying down debt remains one of our key objectives," Yull said.

The company believes gross margin expansion and sales growth expected in 2011 will generate sufficient cash flow from operations for it to pay down debt, he said.

The amount of borrowings under Intertape Polymer's ABL facility, excluding letters of credit, increased by $2.6 million in 2010 to $88.0 million at Dec. 31, according to its earnings release.

At year-end, the company had cash and unused availability under the facility of $43.0 million. During the call, Intertape Polymer's chief financial officer Bernard Pitz noted that the amount would have been $56.2 million if the company had not been required to post a bond of $13.2 million related to the Inspired Technologies Inc. litigation.

Following the close of the year, the bond was replaced with a $1.0 million bond.

At March 21, cash and unused availability under the ABL was more than $44 million, Pitz said.

Intertape Polymer's fourth-quarter sales increased to $180.1 million, compared with $160.8 million for the fourth quarter of 2009. For the full-year, sales were $720.5 million, compared with sales of $615.5 million in 2009.

Fourth-quarter adjusted EBITDA was $11.7 million, versus $7.9 million in the fourth quarter of 2009. The company said the increase primarily reflected higher sales. Full-year adjusted EBITDA was $40.7 million, compared with $43.1 million in 2009.

Intertape Polymer reported a fourth-quarter net loss of $43.4 million, compared with a net loss of $8.5 million for the fourth quarter of the prior year. The net loss was $56.4 million for the full year, versus a net loss of $14.4 million in 2009.

Intertape Polymer is a Saint Laurent, Quebec, developer, manufacturer and seller of polyolefin films, paper and film pressure-sensitive tapes and complementary packaging systems.

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