our fake-wood rat has some nice news
U.S. Plastic Lumber Corp. Announces Strong Growth Projected for 2003
Monday January 6, 8:29 am ET
BOCA RATON, Fla.--(BUSINESS WIRE)--Jan. 6, 2003--U.S. Plastic Lumber Corp. (Nasdaq:USPL - News), announced today that it anticipates strong growth in 2003, even higher than previously projected. Based upon its current sales projections for fiscal 2003, USPL foresees sales growth of approximately 23.5% in 2003 or approximately $63 million. It is also forecasting some improvement in its direct operating and manufacturing margins leading USPL to project in 2003 operating income of approximately $3,500,000, pre-tax income of approximately $1,000,000 and EBITDA of approximately $7,000,000.
USPL announced that there are numerous factors driving its growth. These factors include but are not limited to the following:
Improved deck products creating colors that resist fading and significantly reducing expansion and contraction that otherwise naturally occurs in plastic products.
The improvement in the balance sheet of the Company has created higher order levels as customers have increased orders as the going concern issues of USPL has reduced. USPL announced on December 12, 2002 that its Balance Sheet ratios have improved dramatically, and as an example the debt to equity ratio is approximately .65 to 1 and the debt to capitalization ratio is approximately 41%.
Pressure treated lumber, a $4 billion per year business according to USA Today, is one of the most common forms of lumber used in playgrounds, decks, fences and a wide variety of other exterior applications including docks, bulkheads and seawalls. Approximately 90% of pressure treated lumber is currently manufactured with chemicals containing arsenic (chromated copper arsenate or "CCA"), a known carcinogen. The purpose of the chemical is to protect the lumber from insects and rotting. The United States Environmental Protection Agency has phased in a ban of pressure treated lumber manufactured using CCA that takes effect on December 31, 2003, providing the pressure treated lumber industry wit time to develop another process for preserving the wood without using CCA. Ten other countries in the world have already banned this product. The pressure treated lumber industry is undergoing a wave of litigation from individuals claiming injuries from these chemicals contained in their fences, decks and playgrounds. This is causing lumber dealers throughout the United States to seriously consider carrying alternative lumber products of the type offered by USPL and other alternative lumber manufacturers. USPL believes there exists significant growth opportunity over the next few years for the entire alternative lumber industry as a result.
Growth in consumer acceptance - The alternative lumber industry is a fairly new industry. During the first several years of its development, consumers needed to be educated concerning the existence of alternative lumber products. Today, consumers and contractors across the country are much more aware of the product and are accepting of its low maintenance benefits and aesthetic appeal. This drives more lumberyards to want to be distributors and dealers of this type of product.
Management focus - With the recent sale of our environmental division, the management team is focused solely on growing the plastic lumber business. This renewed focus is already generating positive results in increasing operating margins and increasing sales across its product lines. With the difficult years of 2002 and 2001 behind it, USPL is well positioned with a much improved financial balance sheet to take advantage of the growing opportunities within the alternative lumber industry. |
