Flexible packaging giant Pro-Pac Packaging has come out with sales of $158m for the half-year, up 36 per cent from $116m in the previous corresponding period (pcp), following its $178m merger with Integrated Packaging (IPG) in November.
The company recorded a loss of $3.2m, but there was $9.9m of one-off acquisition costs. Total revenue included two months of trading with IPG, while revenue for Pro-Pac alone was $121m, increasing by $5m from the pcp.
The company’s earnings before interest, tax, depreciation, and amortization (EBITDA) was $9.55m, up 30 per cent from the pcp.
The company is striving to be a leader in the industrial and flexible packaging market, which Pro-Pac says is worth $2.2bn. In its own industrial and flexibles segment, which includes IPG, Pro-Pac’s revenue was up 48.1 per cent from the $66m in the pcp to $127m and EBITDA was up 27.6 per cent from $5.18m to $7.2m. Pro-Pac also commissioning a new high speed flexographic printer in its Chester Hill plant in Sydney. Rigid revenues were stable at $30.9m and EBITDA were $4.4m, up 18 per cent from $3.6m in the pcp.
[Related: Farhour named exec chairman at Pro-Pac]
Grant Harrod, CEO of Pro-Pac says, “The merger with IPG has strengthened our focus in the high growth flexible packaging sector, providing Pro-Pac with an opportunity as both manufacturer and distributor. The business can now provide clients with a total packaging solution by combining IPG’s extensive local manufacturing capability and product innovation skills with Pro-Pac’s global sourcing capability as a major packaging distribution business.
“We plan to further expand our offering into growth markets such as food processing, agriculture and horticultural packaging. All require local processing supported by an increasing requirement for flexible packaging, driven by consumer demand for greater product freshness and portion control.
“The integration of IPG and Pro-Pac is well underway, with Management focused on the rationalisation, consolidation and optimisation of the two businesses. We are on track to exceed the $2m in annualised synergies as previously announced.
“The merger of IPG allows us to establish a new growth platform into the highly fragmented flexible packaging market, where PPG has the opportunity to consolidate and become a market leader. We have a strong M&A pipeline of bolt-on opportunities, and are in advanced discussions on a number of these.”
The company says it remains on track for an annualised sustainable EBITDA, including synergies, of $37.7m.
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