Propex Earnings Decline in Third Quarter
In addition, the company said it will take two significant non-cash one-time charges in the quarter of $19.4 million for goodwill and intangibles impairment and a $33.4 million tax provision.
Propex also said net revenue was $179.5 million compared to $194.6 million a year ago, mostly due to the loss revenues after assets were sold. The shortfall was partially offset by sales increases in North American geosynthetics and concrete.
“Two significant one-time, non-cash charges, combined with a very difficult economic environment – including a significant decline in the number of housing and construction projects – has impacted our business during third quarter,” said Propex President and CEO Joe Dana.
“Some operational anomalies, such as a plant consolidation and the escalating price of raw materials, have also affected our business throughout year,” Dana said.
According to Dana, the company remains well positioned within its key markets, with a high level of liquidity and $58.4 million in cash on hand as of October 31.
Since the merger of SI and Propex Inc., the company has focused on global diversification. Propex Europe posted a revenue increase of 2.2% this quarter, while Propex Brazil revenues increased by 47%.
Propex is also collaborating with its lenders on future financing that will support the company’s long-term growth, according to Dana.