FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a - 16 or 15d - 16 of
the Securities Exchange Act of 1934
For the month of November, 2003
Intertape Polymer Group Inc.
110E Montee de Liesse
St. Laurent, Quebec, Canada, H4T 1N4
[Indicate by check mark whether the registrant files or
will file annual reports under cover of Form 20-F or Form 40-F.]
Form 20-F Form 40-F X
[Indicate by check mark whether the registrant by
furnishing the information contained in this Form is also
thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.]
Yes No X
[If "Yes" is marked, indicate below the file number
assigned to the registrant in connection with Rule 12g3-2(b):
82-______]
The information contained in this Report is incorporated by
reference into Registration Statement No. 333-109944.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
INTERTAPE POLYMER GROUP INC.
Date: November 14, 2003 By: /s/Victor DiTommaso
Victor DiTommaso, CPA
Vice President, Finance
(LOGO)
2003 Third Quarterly Report
OVERVIEW
The Company is beginning to realize the benefits from several previously
described initiatives. In what remains a challenging economic and
competitive environment for the packaging sector, cost reductions coupled
with sales price increases have resulted in improved gross margins in
2003 and consequently, improved profitability as compared to the prior
year, both on a quarterly, as well as a year to date basis. Earnings for
the three months ended September 30, 2003 were $0.18 per share, both
basic and diluted, as compared to a loss of $0.08 a share, both basic and
diluted, for the same period in 2002. Earnings for the nine months ended
September 30, 2003 were $0.38 per share, both basic and diluted, as
compared to $0.13 per share, both basic and diluted, for the same period
in 2002.
Further cost reductions are expected in 2004. The previously announced
consolidation of three existing regional distribution centers into a new
facility in Danville, Virginia is expected to be completed in January
2004. In October 2003, the Company announced the planned consolidation of
its water-activated tape operations into its Menasha, Wisconsin
manufacturing facility during the fourth quarter of 2003. Once completed,
the consolidation is expected to provide between $2 million and $3
million in annual cost savings. The Company expects to record a one-time
charge in the fourth quarter of 2003 associated with closing its water-
activated tape manufacturing facility in Green Bay, Wisconsin. The
estimated charge of $2.5 million is to cover the costs of eliminating
redundant assets, moving equipment from Green Bay to Menasha and severance
costs.
In late September 2003, the Company issued 5,750,000 shares of common
stock at an offering price of Cdn$10.00. The net cash proceeds of $40.8
million (Cdn$55.2 million) were used to repay debt. As a consequence of
the debt repayment, the Company was also able to obtain a 100 basis
point reduction in the cost of its revolving line of credit.
REVIEW OF OPERATIONS
SALES
Sales for the third quarter of 2003 were $159.8 million, an increase of
6.6% over third quarter of 2002 sales of $149.9 million and an increase
of 6.4% over second quarter of 2003 sales of $150.2 million. The
increase was broad-based across product lines and reflects the Company's
investments in developing new products, strengthening product
distributor relationships and the incremental sales associated with
acquiring the remaining 50% interest in the Company's Portuguese joint
venture in late June.
Sales for the first nine months of 2003 were $463.6 million, a 3.0%
increase over sales of $450.3 million for the first nine months of 2002.
GROSS PROFIT AND GROSS MARGINS
Gross profit for the third quarter of 2003 totaled $36.3 million at a
gross margin of 22.7%, as compared to gross profit of $28.4 million for
the third quarter of 2002 at a gross margin of 18.9% (21.3% before one-
time charges). The year over year quarterly improvement reflects the
benefits of the Company's waste reduction programs implemented earlier
this year, the ability to achieve selling price increases as well as
selectively introducing lower cost alternative inputs for certain
products. The 22.7% gross margin for the third quarter of 2003 matched
the gross margin for the second quarter of 2003.
Gross profit for the nine months ended September 30, 2003 totaled
$104.2 million at a gross margin of 22.5% as compared to a gross profit
of $95.7 million at a margin of 21.3% for the corresponding period in
2002. These margin improvements result from the activities described
above.
SELLING, GENERAL AND ADMINSTRATIVE EXPENSES
Selling, general and administrative expenses were $22.3 million for the
third quarter of 2003, compared to $22.3 million ($21.0 million
excluding one-time charges) for the third quarter of 2002. The increase
in expenses was the result of higher selling costs related to increased
sales in higher cost distribution channels, particularly the retail
channel, and the effects of including the remaining 50% interest in the
Portuguese joint venture that was acquired at the end of June 2003.
Selling, general and administrative expenses were $65.1 million for the
nine months ended September 30, 2003, compared to $63.1 million ($61.7
million excluding one-time charges) for the nine months ended September
30, 2002. The increases in 2003 over 2002 levels primarily resulted from
the higher selling costs related to increased sales in higher cost
distribution channels, particularly the retail channel.
OPERATING PROFIT
Operating profit (defined as gross profit less selling, general and
administrative expenses) was $14.0 million for the third quarter of
2003, compared to $6.1 million ($10.9 million before one-time charges)
for the third quarter of 2002. The 28.4% increase in the third quarter
of 2003 over the corresponding amount in 2002 before one-time charges
was the result of increased sales levels along with improved gross
margin.
Operating profit for the nine months ended September 30, 2003 was $39.1
million, compared to $32.7 million ($37.5 million before one-time
charges) for the nine months ended September 30, 2002. The 4.3% increase
in 2003 over 2002 results before one-time charges was the result of
higher levels of sales and improved gross margin.
FINANCIAL EXPENSES
Financial expenses for the third quarter of 2003 were $7.4 million
compared to $8.3 million in the third quarter of 2002, a 10.8% reduction.
The year to year decrease in financial expenses is the result of
substantial debt repayments in the second and third quarters of 2003.
The common stock issuance in late September 2003 that allowed the
Company to repay $40.8 million in debt at the end of the quarter, will
have a favorable impact on financial expenses beginning with the
fourth quarter of 2003.
Financial expenses for the nine months ended September 30, 2003 were
$22.9 million compared to $25.2 million for the same period in 2002.
The 9.1% decrease in financial expenses is attributable to the second
and third quarter debt repayments discussed above, as well as fact
that the first quarter of 2002 had higher interest costs than the rest
of 2002 due to higher debt levels. On March 31, 2002 the Company
issued 5,100,000 shares of common stock raising $47.4 million in net
proceeds which were used to repay debt.
EBITDA
For the third quarter of 2003, earnings before interest, taxes,
depreciation and amortization (EBITDA) was $20.7 million compared
to $12.1 million for the third quarter of 2002. For the nine months
ended September 30, 2003, EBITDA was $56.3 million compared to
$49.7 million for the same period in 2002.
EBITDA is a non-GAAP financial measurement that the Company believes
enhances the understanding of its ongoing operating results, and
which is used by management, lenders, and investors in evaluating a
company's performance. A reconciliation of the Company's EBITDA is
set out in the reconciliation table below:
(in millions of US dollars)
Three Months Nine Months
Periods ended September 30 2003 2002 2003 2002
___________________________________________________________________________
$ $ $ $
Net Earnings (loss) 6.2 (2.8) 13.0 4.3
Add Back (deduct):
Income taxes (0.6) (0.3) 0.1 0.5
Depreciation and
Amortization 8.2 7.3 21.6 21.0
Financial expenses,
net of amortization 6.9 7.9 21.6 23.9
____ ____ ____ ____
EBITDA 20.7 12.1 56.3 49.7
____ ____ ____ ____
NET EARNINGS
Net earnings for the third quarter of 2003 were $6.2 million or $0.18 per share,
both basic and diluted, compared to a net loss of $2.8 million or $0.08 per
share, both basic and diluted for the third quarter of 2002.
Net earnings for the nine months ended September 30, 2003 were $13.0 million
or $0.38 per share, both basic and diluted, compared to $4.3 million or $0.13
per share, both basic and diluted, for the nine months ended September 30,
2002.
Income tax expense for the first half of 2003 was based on the Company's
historical current income tax expense rate. In recent years, as evidenced in
the Company's Annual Report, current taxes have been offset by deferred income
tax benefits. The Company has taken a conservative approach to recognizing
these deferred benefits, wanting to make sure that the benefits are not
recognized prematurely. With nine months of the year's operating results now
available, the Company believes it has sufficient information to recognize
deferred income tax benefits of $1.9 million in the third quarter of 2003.
LIQUIDITY AND CAPITAL RESOURCES
Cash from operations before changes in non-cash working capital items was
$12.5 million for the third quarter of 2003 compared to $5.4 million for
the third quarter of 2002. Changes in non-cash working capital items
provided $7.7 million in additional cash flows for the three months ended
September 30, 2003 compared to using $9.3 million in cash during the same
three month period in 2002.
The improved cash flow in the third quarter of 2003 compared to the third
quarter of 2002 is the result of improved operating performance and more
effective management of payables to vendors. The cash flows for both
three month periods benefited from being past the summer plant shutdowns
that require inventory buildups. Accounts receivable consumed cash in both
three month periods.
Cash from operations before changes in non-cash working capital items was
$33.4 million for the nine months ended September 30, 2003 compared to
$27.1 million for the nine months ended September 30, 2002. Changes in
non-cash working capital items consumed $2.2 million in cash for the nine
months ended September 30, 2003 compared to using $20.7 million in cash
during the same nine month period in 2002.
Similar to the results for the third quarter, the improved cash flow for
the nine months ended September 30, 2003 compared to the nine months ended
September 30, 2002 is the result of improved operating performance and
more effective management of payables to vendors.
LIQUIDITY
The Company has reduced total indebtedness for the three and nine months
ended September 30, 2003 (before considering debt assumed in acquiring
the remaining 50% interest in the Portuguese joint venture) by $50.2
million and $53.9 million, respectively. Of the total repayments, $40.8
million was from the proceeds of the September 2003 common stock
issuance and the balance ($9.4 million for the three months and $13.1
million for the nine months) was from cash generated from operations.
Of the $16.9 million in current installments of long-term debt at
September 30, 2003, $16.0 million is due in September 2004.
The Company expects to generate approximately $22.0 million in excess
cash (defined as cash flows from operating activities less cash used
for investing activities) for the full year. This is down from the
original outlook of $29.0 million primarily due to $6.0 million spent
in the third quarter of 2003 in settlement of contingent consideration
arising from the acquisition of certain assets of Olympian Tape Sales,
Inc. d/b/a United Tape Company.
In North America, the Company has a $50.0 million revolving line of
credit facility. As at September 30, 2003, $19.2 million was available
for future use. The drawn portion includes letters of credit of $3.9
million.
The Company remains in full compliance with all of its financial and
other covenants relating to its outstanding debt obligations, and
believes that its funds generated through future operations and
availability of borrowings under its credit facilities will be sufficient
to fund its debt service and working capital requirements for the
foreseeable future.
CURRENCY RISK
The Company is subject to currency risks through its Canadian and
European operations. Changes in the exchange rates may result in
decreases or increases in the foreign exchange gains or losses. The
Company does not use derivative instruments to reduce its exposure to
foreign currency risk, as historically these risks have not been
significant.
FORWARD-LOOKING STATEMENTS
Certain statements and information set forth in this Quarterly Report,
including statements regarding the business and anticipated financial
performance of the Company, constitute "forward-looking statements"
within the meaning of the Federal Private Securities Litigation Reform
Act of 1995. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed
or implied in such forward-looking statements.
Some of the factors that could cause such differences include, but are
not limited to, inflation and general economic conditions, changes in
the level of demand for the Company's products, competitive pricing
pressures, and general market trends. Additional discussion of factors
that could cause actual results to differ materially from management's
projections, estimates and expectations is contained in the Company's
SEC filings. These and other factors should be considered carefully and
undue reliance should not be placed on forward-looking statements. The
Company undertakes no duty to update its forward-looking statements,
including its earnings outlook.
Intertape Polymer Group Inc.
Consolidated Earnings (unaudited)
Periods ended September 30,
(In thousands of US dollars, except per share amounts)
(Unaudited)
Three months Nine months
_________________________ _______________________
2003 2002 2003 2002
___________ ___________ __________ __________
$ $ $ $
Sales 159,798 149,920 463,639 450,314
Cost of sales 123,489 121,532 359,448 354,566
___________ ___________ __________ __________
Gross profit 36,309 28,388 104,191 95,748
Selling, general and
administrative expenses 22,264 22,309 65,076 63,062
Research and development 1,080 926 3,060 2,689
Financial expenses 7,409 8,297 22,934 25,152
___________ ___________ __________ __________
30,753 31,532 91,070 90,903
___________ ___________ __________ __________
Earnings (loss) before
income taxes 5,556 (3,144) 13,121 4,845
Future Income taxes
(recovery) (643) (357) 118 525
___________ ___________ __________ __________
Net earnings (loss) 6,199 (2,787) 13,003 4,320
___________ ___________ __________ __________
Earnings (loss) per share
Basic 0.18 (0.08) 0.38 0.13
___________ ___________ __________ __________
Diluted 0.18 (0.08) 0.38 0.13
___________ ___________ __________ __________
Consolidated Retained Earnings
Periods ended September 30,
(In thousands of US dollars)
(unaudited)
_____________________________________________________________________________________
Three months Nine months
_________________________ _______________________
2003 2002 2003 2002
___________ ___________ __________ __________
$ $ $ $
Balance, beginning of period 56,918 111,674 50,114 104,567
Net earnings (loss) 6,199 (2,787) 13,003 4,320
___________ ___________ __________ __________
Balance, end of period 63,117 108,887 63,117 108,887
___________ ___________ __________ __________
Intertape Polymer Group Inc.
Consolidated Balance Sheets
As at
(In thousands of US dollars)
September 30, September 30, December 31,
2003 2002 2002
(Unaudited) (Unaudited) (Audited)
________ ________ ____________
$ $ $
ASSETS
Current assets
Trade receivables (net of allowance
for doubtful accounts of $3,274
($3,552 in September 2002, $3,844
in December 2002) 97,034 94,996 86,169
Other receivables 10,155 11,137 10,201
Inventories 67,128 71,637 60,969
Parts and supplies 13,046 12,566 12,377
Prepaid expenses 5,917 4,711 7,884
Future income tax assets 2,397 4,025 2,397
______ ______ ______
195,677 199,072 179,997
Property, plant and equipment 355,297 357,041 351,530
Other assets 12,137 12,508 13,178
Goodwill 172,007 228,525 158,639
735,118 797,146 703,344
_______ _______ _______
LIABILITIES
Current liabilities
Bank indebtedness 18,376 25,992 8,573
Accounts payable and accrued
liabilities 92,739 73,433 80,916
Instalments on long-term debt 16,886 9,929 29,268
________ _______ _______
128,001 109,354 118,757
Long-term debt 234,353 311,722 283,498
Other liabilities 3,530 3,785 3,550
Future income taxes 2,623 22,112 4,446
________ _______ _______
368,507 446,973 410,251
________ _______ _______
SHAREHOLDERS' EQUITY
Capital stock and share purchase
warrants 289,367 238,538 239,185
Retained earnings 63,117 108,887 50,113
Accumulated currency translation
adjustments 14,127 2,748 3,795
_______ _______ _______
366,611 350,173 293,093
_______ _______ _______
735,118 797,146 703,344
Intertape Polymer Group Inc.
Consolidated Cash Flows
Periods ended September 30,
(In thousands of US dollars
(Unaudited)
Three months Nine months
_________________________ _______________________
2003 2002 2003 2002
___________ ___________ __________ __________
$ $ $ $
OPERATING ACTIVITIES
Net earnings (loss) 6,199 (2,787) 13,003 4,320
Non-cash items
Depreciation and amortization 8,226 7,342 21,589 21,006
Loss on disposal of property,
plant and equipment 1,250 1,250
Future income taxes (1,926) (357) (1,166) 525
___________ ___________ __________ __________
Cash from operations before
changes in non-cash working
capital items 12,499 5,448 33,426 27,101
___________ ___________ __________ __________
Changes in non-cash working
capital items
Trade receivables (6,635) (5,237) (9,357) (8,350)
Other receivables (70) 1,877 46 2,655
Inventories 5,029 4,713 (3,118) (815)
Parts and supplies (545) (122) (669) (655)
Prepaid expenses 212 1,423 2,057 4,744
Accounts payable and accrued
liabilities 9,667 (11,981) 8,859 (18,283)
___________ ___________ __________ __________
7,658 (9,327) (2,182) (20,704)
___________ ___________ __________ __________
Cash flows from operating
activities 20,157 (3,879) 31,244 6,397
___________ ___________ __________ __________
INVESTING ACTIVITIES
Property, plant and equipment (4,620) (3,119) (9,700) (9,586)
Goodwill (6,217) (6,217)
Other assets (75) (1,323) (683) (3,594)
__________ ___________ _________ __________
Cash flows from investing
activities (10,912) (4,442) (16,600) (13,180)
__________ ___________ _________ __________
FINANCING ACTIVITIES
Net change in bank indebtedness (5,762) 6,269 9,413 (2,106)
Repayment of long-term debt (43,212) (3,635) (64,329) (41,324)
Issue of common shares 42,457 1,716 42,457 49,042
__________ ___________ _________ __________
Cash flows from financing
activities (6,517) 4,350 (12,459) 5,612
__________ ___________ _________ __________
Net increase (decrease) in
cash position 2,728 (3,971) 2,185 (1,171)
Effect of foreign currency
translation adjustments (2,728) 3,971 (2,185) 1,171
__________ ___________ _________ __________
Cash position, beginning and
end of period --- --- --- ---
__________ ___________ _________ __________
NOTE 1.
Basis of Presentation
In the opinion of Management the accompanying unaudited interim consolidated
financial statements, prepared in accordance with Canadian generally accepted
accounting principles, contain all adjustments necessary to present fairly
Intertape Polymer Group Inc.'s (IPG) financial position as at September 30,
2003 and 2002 and December 31, 2002 as well as its results of operations and
its cash flows for the three and nine months ended September 30, 2003 and 2002.
While Management believes that the disclosures presented are adequate, these
unaudited interim consolidated financial statements and notes should be read in
conjunction with IPG's annual consolidated financial statements.
These unaudited interim consolidated financial statements and notes follow the
same accounting policies as the most recent annual consolidated financial
statements.
NOTE 2.
Earnings per Share
The following table provides a reconciliation between basic and diluted
earnings per share:
In thousands of US dollars
(Except per share amounts)
_____________________________________________________________________________________
Three months Nine months
_________________________ _______________________
Periods ended September 30 2003 2002 2003 2002
___________ ___________ __________ __________
$ $ $ $
Net earnings (loss) applicable
to common shares 6,199 (2,787) 13,003 4,320
Weighted average number of
common shares outstanding
(000s) 35,302 33,701 34,319 32,470
Effect of dilutive stock
options and warrants(a)(000s) 96 90 431
___________ ___________ __________ __________
Weighted average number of
diluted common shares
outstanding (a)(000s) 35,398 33,701 34,409 32,901
___________ ___________ __________ __________
Basic earnings (loss) per
share 0.18 (0.08) 0.38 0.13
Diluted earnings per share 0.18 (0.08) 0.38 0.13
(a) Diluted earnings per share is calculated by adjusting outstanding shares,
assuming any dilutive effects of stock options and warrants.
NOTE 3.
Accounting for Compensation Programs
As at September 30, 2003 the Company had a stock-based compensation plan,
which is described in the 2002 Annual Report. The Company does not record
any compensation expense with respect to this plan.
The following table provides a reconciliation between net earnings (loss)
and net earnings (loss) per share (basic and diluted) and the pro forma
results had compensation cost for the company's stock-based compensation
plan been determined using the fair value based method for awards at
grant date under the plan:
In thousands of US dollars
(Except per share amounts)
_____________________________________________________________________________________
Three months Nine months
_________________________ _______________________
Periods ended September 30, 2003 2002 2003 2002
___________ ___________ __________ __________
$ $ $ $
Net earnings (loss) 6,199 (2,787) 13,003 4,320
Effect of fair value method (225) (165) (621) (328)
___________ ___________ __________ __________
Pro forma net earnings (loss) 5,974 (2,952) 12,382 3,992
___________ ___________ __________ __________
Basic and diluted earnings
(loss) per share 0.18 (0.08) 0.38 0.13
Effect of fair value method (0.01) (0.01) (0.02) (0.01)
___________ ___________ __________ __________
Pro forma basic and diluted
earnings (loss) per share 0.17 (0.09) 0.36 0.12
___________ ___________ __________ __________
NOTE 4.
Differences in Accounting Between The United States of America and Canada
Re-pricing of Stock Options
The re-pricing of stock options that occurred in 2001 has resulted, under
US GAAP, in variable plan accounting for the re-priced options. Under US
GAAP, the Company would not have recorded a non-cash charge for the three
months and nine months ended September 30, 2003, but would have recorded
a non-cash charge (recovery) of ($1.3) million and $0.9 million for the
three months and nine months ended September 30, 2002. The charge would
have no income tax consequences for the Company and would reflect the
changes in the market price of the common shares.
Accordingly, the Company's net earnings (loss), basic earnings (loss) per
share and diluted earnings (loss) per share would have been unchanged for
the three months and nine months ended September 30, 2003 and would be
reduced by $1.3 million and $0.9 million, $0.03 (basic), $0.03 (diluted),
$0.02 (basic), $0.03 (diluted) respectively for the three months and nine
months ended September 30, 2002.
NOTE 5.
Capital Stock
In September 2003, the Company issued 5,750,000 common shares for cash
consideration of CAN$57,500,000 - (US$ 42,512,000). The net proceeds
after tax benefits were approximately $41,300,000.
In August 2003, the Company issued 238,535 common shares to the USA
Employees Stock Ownership and Retirement Savings Plan at a value of
US$1,694,000.
In June 2003, the Company issued 1,030,767 common shares to acquire
the remaining 50% interest in a joint venture. As explained in Note
7, the transaction was valued at $7,177,000.
In March 2002, the Company issued 5,100,000 common shares for cash
consideration of CAN $75,700,000 (US $47,441,000).
The Company's outstanding shares outstanding as at September 30, 2003
and September 30, 2002 were 40,840,376 and 33,821,074, respectively.
Average number of common shares outstanding
Three months Nine months
_________________________ _______________________
Periods ended September 30, 2003 2002 2003 2002
_______________________________________________________ _______________________
$ $ $ $
CDN GAAP - Basic 35,302,174 33,701,307 34,318,592 32,469,521
CDN GAAP - Diluted 35,397,800 33,701,307 34,409,403 32,900,516
U.S. GAAP - Basic 35,302,174 33,701,307 34,318,592 32,469,521
U.S. GAAP - Diluted 35,397,800 33,701,307 34,409,403 32,900,516
NOTE 6.
Financial Expenses
In thousands of US dollars
Three months Nine months
_________________________ _______________________
Period ended September 30, 2003 2002 2003 2002
_______________________________________________________ _______________________
$ $ $ $
Interest on long term debt 6,671 6,968 20,706 21,463
Other financial expenses 888 1,429 2,678 3,989
Interest capitalized to
property, plant & equipment (150) (100) (450) (300)
_____ _____ ______ ______
7,409 8,297 22,934 25,142
_____ _____ ______ ______
NOTE 7.
Acquisition of Business
On June 26, 2003, the Company acquired the remaining 50% equity interest in
Filose Portuguesa Filmes Biorientados S. A. (Fibope), a manufacturer and
distributor of film products in Portugal.
The acquisition has been accounted for using the purchase method of
accounting and, accordingly, the purchase price has been allocated to
the assets and liabilities based on their estimated fair values as at the
date of the acquisition. The results of Fibope have been included in the
Company's consolidated results from the date of acquisition. Previously,
the Company had accounted for its investment in Fibope as a joint venture
using the proportionate consolidation method.
The purchase price of $7.2 million was settled by the issuance of
1,030,767 common shares of the Company. The terms of the purchase agreement
provide for either additional shares to be issued or a cash payment to be
made to a maximum of $1.2 million, at the Company's option, if the value
of the above shares is below a specified value on December 26, 2004. The
issue of any additional shares will have no impact on the recorded amounts
and any cash payment will reduce the recorded value of the capital stock
of the Company.
The Company acquired assets with a fair value of $11.1 million, including
approximately $3.4 million of goodwill, and assumed liabilities of $3.9
million, of which $2.2 million was interest-bearing debt.
NOTE 8.
Goodwill
During July 2003, the Company satisfied a contingent consideration arising
from the September 1, 2000 acquisition of certain assets of Olympian Tape
Sales, Inc. d/b/a United Tape Company (UTC), by making a $6.0 million cash
payment to a third party. The cash payment and certain related expenses
have been recorded in the third quarter of 2003 as an increase in the
goodwill of $6.2 million arising from the UTC acquisition.
The Company has additional related expenses that are subject to
reimbursement in whole or in part from amounts available under an escrow
agreement created at the time of the acquisition. Expenses, if any, not
reimbursed will be recorded as additional goodwill upon settlement of the
escrow account.
Note 9.
Subsequent Event
On October, 14, 2003 the Company announced that it will be consolidating
its water-activated tape operations into its Menasha, Wisconsin
manufacturing facility. Accordingly, the Company plans to close its
manufacturing operation in Green Bay, Wisconsin during the fourth quarter
of 2003 and expects to record a charge of approximately $2.5 million
against fourth quarter earnings to cover the costs of eliminating
redundant assets, moving equipment from Green Bay to Menasha and
severance costs.
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Intertape Polymer Group.
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Please fax a copy of this page to: 110E Montee de Liesse
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Intertape Polymer Group Inc. Canada, H4T 1N4
Fax: 941-727-3798 Investor Relations
Toll Free: 866-202-4713
www.intertapepolymerl.com
itp$info@intertapeipg.com