Atlantis Plastics: 1998 4th Quarter-Year End FOR IMMEDIATE RELEASE FOR FURTHER INFORMATION: Patricia C. Johnson Specialist, Corporate Communications (305) 858-2200 ATLANTIS PLASTICS ANNOUNCES SIGNIFICANTLY IMPROVED FOURTH QUARTER AND FULL-YEAR RESULTS ATLANTA, GA - (February 3, 1999) Atlantis Plastics, Inc. (ASE:AGH) today announced its operating results for the fourth quarter and fiscal year ended December 31, 1998. Net income from continuing operations in the fourth quarter 1998 was $2.1 million, or $0.27 per diluted share ($0.28 per basic share), compared to net income from continuing operations of $0.7 million or $0.10 per share (diluted and basic) in the fourth quarter 1997. Net sales in the 1998 fourth quarter were $59.4 million compared to $62.3 million in the same quarter of 1997. For the full year, net income from continuing operations was $6.7 million or $0.87 per diluted share ($0.90 per basic share) compared to $0.3 million or $0.04 per share (diluted and basic) for the 1997 calendar year. Net sales for calendar year 1998 totaled $250.8 million compared to $256.1 million in calendar 1997. For the full year and fourth quarter, increases in volume were more than offset by film price decreases resulting from a drop in resin prices of about 25% during 1998. Earnings before interest, taxes, depreciation and amortization ("EBITDA") were $8.6 million for the fourth quarter 1998 compared to $6.7 million for fourth quarter of 1997, an increase of 29%. For calendar year 1998 EBITDA was $30.7 million compared to $22.2 million in 1997, an increase of 38%. Atlantis incurred an after-tax extraordinary loss of $0.4 million in the 1998 third quarter related to the early extinguishment of debt, due to the repurchase of $14.7 million of its 11% Senior Notes due February 2003. As a result of this repurchase, the Company has met its obligation to make a $25 million principal repayment due February 15, 2001. The next scheduled repayment of principal is $24.8 million due February 15, 2002. In the fourth quarter 1998, the Company's gross margin was 21% compared to 17% in the fourth quarter 1997, and its operating margin was 10% compared to 7% for the same period in 1997. The improvement in profitability was due to the continued impact of cost reduction measures, increased volume, and a more favorable pricing environment in the Company's Plastic Films segment, and improved productivity in the Company's Injection Molding operations. Gross margin in the Plastic Films segment was 22% in the 1998 fourth quarter compared with 18% in fourth quarter 1997. Gross margin in the Molded Products segment for the 1998 fourth quarter was 17%, compared to 17% in the 1997 fourth quarter, and 11% in the third quarter of 1998. The Company's fourth quarter Selling, General & Administrative (SG&A) decreased to $6.2 million in 1998 from $6.6 million in 1997. Interest expense fell to $2.4 million in the just completed quarter compared to $2.8 million in the fourth quarter 1997. Net debt (total debt less cash) continued its decline reaching its lowest level in ten years. At December 31, 1998, it was $84.3 million compared to $89.9 million in September 30, 1998. For the full year, net debt decreased by $12.5 million. Anthony F. Bova, President and Chief Executive Officer, said "We are very pleased with our 1998 full-year and fourth quarter results. Our operating income for the year totaled $21.1 million, a 65% increase over 1997. Our Plastic Films segment continued its strong performance and increased volume 6% compared with the fourth quarter of last year fueled by an increase of more than 8% in Stretch Film. Importantly, in the fourth quarter we began to see the results of our efforts to improve our Injection Molding segment. In summary, our fourth quarter, which is usually negatively impacted by seasonal factors, produced the highest quarterly operating results in four years." As previously released, Atlantis incurred a non-recurring pretax charge of $0.8 million, $0.07 per share in 1997, relating to restructuring expense in its stretch film unit and the closing of the Company's Nashville injection molding facility. In November 1996, the Board of Directors authorized the repurchase of up to one million shares of Class A common stock, or 14% of the 7.1 million Class A and Class B common shares then outstanding. Through 1998, the Company repurchased 542,544 shares, as well as options for 55,125 shares. Atlantis Plastics, Inc. is a leading U.S. manufacturer of polyethylene stretch and custom films and molded plastic products. Stretch films are used to wrap pallets of materials for shipping or storage, and custom films, which are made-to-order specialty film products, are used in the industrial and packaging markets. Atlantis' molded plastic products are used primarily in the appliance, automotive, agricultural, building supply, and recreational vehicle industries. Additional information is available on the Internet at http://www.cfonews.com/agh. ### ATLANTIS PLASTICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited - in thousands, except per share data) Three Months Ended Twelve Months Ended December 31, December 31, 1998 1997 1998 1997 Net sales................... $59,369 $62,335 $250,830 $256,083 Cost of sales............... 47,053 51,464 205,067 216,948 Gross profit.... 12,316 10,871 45,763 39,135 Selling, general and administrative expenses.... 6,206 6,642 24,648 25,480 Impairment of long-lived assets and restructuring charges.. - (20) - 815 Operating income. 6,110 4,249 21,115 12,840 Net interest expense........ (2,416) (2,811) (10,452) (11,427) Income from continuing operations before income taxes.... 3,694 1,438 10,663 1,413 Income tax provision........ (1,628) (706) (3,974) (1,138) Income from continued operations ............... 2,066 732 6,689 275 Income from discontinued operations, net of income taxes - 126 - 126 Extraordinary loss on early extinguishment of debt,net. - - (390) - Net income...... $2,066 $858 $6,299 $401 Earnings per Common Share (Basic) Income from continuing operations ..... $0.28 $0.10 $0.90 $0.04 Income from disc. operations/ extraordinary loss......... - 0.02 (0.05) 0.02 Net income...... $0.28 $0.12 $0.85 $0.06 Weighted-average number of shares 7,456 7,092 7,433 7,106 Earnings per Common Share (Diluted) Income from continuing operations...... $0.27 $0.10 $0.87 $0.04 Income from disc. operations/ extraordinary loss.... - 0.02 Net income ...... $0.27 $0.12 $0.81 $0.05 Weighted-average number of shares 7,733 7,406 7,732 7,600 ATLANTIS PLASTICS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited - in thousands) December 31, December 31, 1998 1997 ASSETS Cash and equivalents........................ $2,879 $8,346 Accounts receivable,net............ 25,801 25,444 Inventories........................ 14,918 18,517 Other current assets............... 8,376 7,448 Current assets................. 51,974 59,755 Property and equipment,net......... 58,403 60,065 Goodwill, net of accumulated amortization........................ 47,390 48,961 Other assets........................ 1,465 2,108 $159,232 $170,889 LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable and accrued expenses $22,677 $24,146 Current portion of long-term debt... 2,538 3,254 Currentliabilities.............. 25,215 27,400 Long-term debt, less current portion 84,620 101,862 Deferred income taxes............... 10,149 8,287 Other liabilities................... 544 791 Total liabilities............... 120,528 138,340 Commitments and contingencies....... - - Shareholders' equity: Class A Common Stock, $.10 par value, 20,000,000 shares authorized, 4,538,054 and 4,358,516 shares issued and outstanding in 1998 and 1997.............................. 454 436 Class B Common Stock, $.10 par value, 7,000,000 shares authorized, 2,918,043 and 2,742,280 shares issued and outstanding in 1998 and 1997............................... 292 274 Additional paid-in capital......... 9,436 7,117 Notes receivable from sale of Common Stock (960) - Retained earnings.................. 29,482 24,722 Total shareholders'equity........ 38,704 32,549 $159,232 $170,889 ATLANTIS PLASTICS, INC. AND SUBSIDIARIES SEGMENT/TREND INFORMATION ($ in millions) 1998 1997 NET SALES Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1* Plastic Films $42.7 $44.3 $44.4 $44.9 $45.5 $47.6 $48.1 $45.7 Molded Plastics 16.7 18.7 19.7 19.5 16.8 16.3 17.4 18.6 TOTAL $59.4 $63.0 $64.1 $64.4 $62.3 $63.9 $65.5 $64.3 EBITDA** $8.6 $7.3 $7.2 $7.7 $6.7 $6.4 $5.2 $4.0 GROSS PROFIT Plastic Films 22% 20% 20% 19% 18% 17% 13% 13% Molded Plastics 17% 11% 12% 15% 17% 13% 17% 18% TOTAL 21% 18% 17% 18% 17% 16% 14% 14% OPERATING INCOME Plastic Films 12% 11% 9% 9% 7% 8% 3% 3% Molded Plastics 7% 1% 4% 6% 5% 2% 6% 8% TOTAL 10% 8% 7% 8% 7% 6% 4% 4% NET INTEREST EXPENSE $2.4 $2.6 $2.7 $2.7 $2.8 $2.9 $2.9 $2.8 *Excluding impairment and restructuring charges *Earnings before interest, taxes, depreciation, and amortization Ends.