Executive Summary
Business. The Company's operations are organized into four operating segments:
Acquisitions and Dispositions. Our acquisition strategy is focused on improving our long-term financial performance, enhancing our market positions, and expanding our existing and complementary product lines. We seek to obtain businesses for attractive post-synergy multiples, creating value for our stockholders from synergy realization, leveraging the acquired products across our customer base, creating new platforms for future growth, and assuming best practices from the businesses we acquire. While the expected benefits on earnings is estimated at the commencement of each transaction, once the execution of the plan and integration occur, we are generally unable to accurately estimate or track what the ultimate effects have been due to system integrations and movements of activities to multiple facilities. As historical business combinations and restructuring plans have not allowed us to accurately separate realized synergies compared to what was initially identified, we estimate the synergy realization based on the overall segment profitability post integration.
In
Raw Material Trends. Our primary raw material is plastic resin. Due to differences in the timing of passing through resin cost changes to our customers on escalator/de-escalator programs, segments are negatively impacted in the short term when plastic resin costs increase and are positively impacted when plastic resin costs decrease. This timing lag and competitor behaviors related to passing through raw material cost changes could affect our results as plastic resin costs fluctuate. In addition, we use other materials such as butyl rubber, adhesives, paper and packaging materials, linerboard, rayon, polyester fiber, and foil, in various manufacturing processes. These raw materials are available from multiple sources and we purchase from a variety of global suppliers. While temporary shortages of raw materials can occur, we expect to continue to successfully manage raw materials supplies without significant supply interruptions.
Outlook. The Company is affected by general economic and industrial growth,
plastic resin availability and affordability, and general industrial
production. Covid-19 pandemic has resulted in both advantaged and disadvantage
products within all segments. Our results are affected by both the duration
certain products remain advantaged and timing of when disadvantage products
normalize. Our business has both geographic and end market diversity, which
reduces the effect of any one of these factors on our overall performance. Our
results are affected by our ability to pass through raw material and other cost
changes to our customers, improve manufacturing productivity and adapt to volume
changes of our customers. By providing advantaged products in targeted markets,
we continue to believe our underlying long-term demand fundamental in all
divisions will remain strong as we focus on delivering protective solutions that
enhance consumer safety and execute on the Company's mission of "Always
Advancing to Protect What's Important." For fiscal 2021, we project cash flow
from operations between
16
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Results of Operations
Comparison of the Quarterly Period Ended
The Company's
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