AEP Industries Inc AEPI
Q1 2013 Earnings Call Transcript

Transcript Call Date 03/13/2013

Operator: Good morning. My name is Jackie and I will be your conference operator today. At this time, I would like to welcome everyone to the AEP Industries, Inc. First Quarter 2013 Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

Thank you. (Mr. Lamplough), you may begin your conference.

Nicholas Lamplough - IR: Thank you. Before we get started, I would like to remark briefly about our forward-looking statements. Except for historical information mentioned during the conference call, statements made by the management of AEP Industries are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. Those risks included, but are not limited to, risks associated with pricing, volume, and conditions of the markets. Those and other risks are described in the Company's filings with the SEC over the last 12 months, copies of which are available from the SEC or may be obtained from the Company.

Today's format will be as follows; Brendan Barba, Chairman, President and CEO will discuss operations and then Paul Feeney, Executive Vice President, Finance and CFO will discuss the financial results. After the prepared remarks, Brendan and Paul will be available for questions.

So, without further delay, I would like to turn the call over to Mr. Barba. Brendan?

J. Brendan Barba - Chairman, President and CEO: Thank you. Good morning, everyone. Welcome to our first quarter 2013 conference call. Our results for the first quarter were strong. Typically the first quarter is our weakest, and we’re really encouraged by the strong start.

Volumes for the first quarter were down slightly in the November-December-January period. Our typical slow first quarter, this is always the period that is slowest for us. Most of the lost business has to do with us price managing at just about every business that we're in right now. We're not concerned about it. Our second quarter will be very strong, and for the year we expect to achieve our overall sales plan. We also are not expecting any help from the economy. We have to do it on our own.

To talk a little bit about resin; we forecasted in our year-end call that resin pricing, would remain very volatile. This has certainly turned out to be accurate. On January 1, we were increased $0.05 pound and AEP has increased prices across the board and we've actually added some margin on those price increases. On 3/1, prices are up $0.04. This seems to be holding and we’ve again announced price increases in all of our operating divisions. There is a third increase announced for April 1st. We don’t see this increase holding, but we’ll have to keep an eye on it and for the year, we’re forecasting that prices will be up as they have been. And then somewhere around the next quarter, we expect prices to start coming down. And over the course of the year, we’re looking at pricing being about neutral.

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