Net income in the third quarter increased 43.8% over the second quarter of 2008 to $3.4 million and improved $24.3 million from the net loss of $20.9 million recorded in third quarter of 2007. For the first nine months of fiscal 2008, net income improved to $7.2 million compared to a loss of $19.4 million for the same period in 2007.
Gross profit for the quarter was up 8.5% over the prior year to $43 million; however, margins were negatively impacted by significant increases in raw material costs during the quarter. Year-to-date gross profit was $131.8 million compared to $130 million for the first nine months of 2007.
CEO Ronee Hagen stated, “Our performance in the third quarter was overshadowed by the extreme fluctuations in the raw material market. However, underlying volume demand was stable during the quarter in disposable nonwovens applications, reflecting PGI’s more defensive model in a turbulent economic environment.”
Ms. Hagen also said that PGI continued to achieve growth in its developing regions of Latin American and Asia, despite a challenging market environment in South America. The company’s proprietary Spinlace line was running at full capacity during the quarter and PGI began rolling the product out in its converted wipes business both in the U.S. and Europe. While PGI began to experience some softening in durable goods applications in industrial markets, certain product applications contributed offsetting volume gains during the quarter, she said.