Graf-Pak acquisition now integrated into the Lachine folding carton hub
Montreal, Quebec, August 10, 2023 – Supremex Inc. (“Supremex” or the “Company”) (TSX: SXP), a leading North American manufacturer and marketer of envelopes and a growing provider of paper-based packaging solutions, today announced its results for the second quarter ended June 30, 2023. The Company will hold a conference call to discuss these results, today at 10:00 a.m. (Eastern Time).
Second Quarter Financial Highlights and Recent Events
- Total revenue increased by 14.6% to $71.7 million, from $62.5 million in the second quarter of 2022.
- Envelope segment revenue up 7.3% to $49.3 million, from $45.9 million in the prior year.
- Packaging and specialty products segment revenue of $22.4 million, up 34.7% from $16.6 million last year.
- Net earnings were $2.1 million, compared to $7.4 million last year.
- Earnings per share of $0.08, versus $0.28 a year ago.
- Adjusted EBITDA1 of $9.6 million, or 13.3% of revenue, versus $13.9 million, or 22.3% of revenue, a year ago.
- Acquisition on May 8, 2023 of Graf-Pak Inc. (“Graf-Pak”), a provider of folding carton packaging solutions located in the province of Quebec.
- Appointment of François Bolduc as Chief Financial Officer of the Company, effective July 4, 2023.
- On August 9, 2023, the Board of Directors declared a quarterly dividend of $0.035 per common share, payable on September 22, 2023 to shareholders of record at the close of business on September 7, 2023.
“Our second quarter results reflect the temporary effect of inventory adjustments by certain customers and lower demand from sectors more affected by inflation and interest rate levels,” said Stewart Emerson, President & CEO of Supremex. “The first half of 2023 was a very busy period, especially for our Packaging operations, as we consolidated a significant portion of our folding carton activities under one roof in Lachine while also integrating two acquisitions. Our Envelope business continued to generate a solid free cash flow which allowed us to fund our expansion and reduce debt by $3.1 million this past quarter.”
“Although disappointed with the transitory profitability reduction in Packaging, we are excited with the significant potential of the Lachine facility. Its considerable footprint will enable us to further expand folding carton production to better meet additional demand from this growing market. In this regard, the Graf-Pak operations have been successfully merged into Lachine and we continue to assess initiatives to further optimize efficiency and achieve synergies by leveraging available capacity,” concluded Mr. Emerson.