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FiberMark Acquisition Boosts Neenah’s Sales in Q3

Net sales up 8%.

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By: Tara Olivo

Associate Editor at Nonwovens Industry, Rodman Media

In the third quarter of 2015, Neenah Paper’s net sales of $231.6 million increased 8% from the prior year as an 11% boost in sales from the FiberMark acquisition and modest growth in existing businesses more than offset a 4% decrease due to changes in foreign currency rates.
 
Operating income grew 12% and, after excluding acquisition and restructuring costs in both periods, adjusted operating income increased 21% with higher organic and acquisition volume, improved net selling prices and lower cost of sales.
 
FiberMark was acquired on August 1, increasing capabilities and presence in areas such as premium packaging and other specialty markets. A definitive agreement was signed to sell the Company’s nonwoven wall cover business located in Lahnstein, Germany, and the sale closed on October 31.
 
“Our businesses performed well in the quarter, with filtration-led growth in Technical Products, and increased margins and operating income in each of our segments,” says John O’Donnell, CEO. “With the FiberMark acquisition, an organic investment to add transportation filtration capacity in the U.S., and the divestiture of Lahnstein, we are continuing to actively reshape Neenah with a focus on profitable and growing markets. What has remained consistent as we execute across these multiple fronts are the strategic priorities and ROIC focus that guide our capital deployment decisions, balancing high-returning organic investments, value-adding acquisitions and increased cash returns to shareholders.”
 
Technical Products net sales of $108.9 million increased 3% compared with prior year sales of $106.2 million. Revenues grew 9% due to the FiberMark acquisition but were reduced by an approximately equal amount due to unfavorable currency translation effects. Organic sales on a constant currency basis grew 2% primarily due to volume growth in filtration and labels that offset weaker backing shipments.
 

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