Atlantis Plastics: Third Quarter Earnings FOR IMMEDIATE RELEASE FOR FURTHER INFORMATION: Patricia C. Johnson Specialist, Corporate Communications (305) 858-2200 ATLANTIS PLASTICS, INC. ANNOUNCES 83% INCREASE IN THIRD QUARTER EPS Atlanta, GA - (October 28, 1999) Atlantis Plastics, Inc. (ASE:AGH) today announced its operating results for the third quarter ended September 30, 1999. Net income in the 1999 third quarter was $0.32 per diluted share, an increase of 83% over third quarter 1998 income before extraordinary items of $0.17 per diluted share. In the third quarter of 1998, Atlantis incurred an extraordinary loss of $390,000 after tax or $0.05 per diluted share, associated with the buyback of $14.7 million of the Company's Senior Notes. Third quarter 1999 net income of $0.32 per diluted share compares with 1998 third quarter net income of $0.12 per diluted share. Net income in the third quarter of 1999 totaled $2.5 million compared with 1998 third quarter income before extraordinary items of $1.4 million and 1998 third quarter net income of $1.0 million. Net sales for the third quarter of 1999 increased to $65.1 million, an increase of 3.4% from $63.0 million in the same quarter of 1998. Net income for the first nine months of 1999 was $7.3 million, or $0.92 per diluted share, representing increases of 57% and 54%, respectively, over 1998 income before extraordinary items of $4.6 million, or $0.60 per diluted share, and increases of 72% and 69%, respectively, over 1998 year to date net income of $4.2 million, or $0.55 per diluted share. On a year to date basis, net sales for 1999 were $189.1 million compared with $191.5 million in 1998. Earnings before interest, taxes, depreciation, and amortization ("EBITDA") for the third quarter of 1999 was $9.0 million, an increase of 24% over the same period of 1998. On a year to date basis, 1999 EBITDA was $26.6 million, an increase of 20% over year to date 1998. As of September 30, 1999, on a trailing twelve-month basis, EBITDA was $35.1 million. Atlantis' overall gross margins for the third quarter of 1999 was 19% compared with 17% in the comparable period of 1998. For the first nine months of 1999, Atlantis' gross margin was 20% compared with 17% in 1998. Operating margins for the third quarter and first nine months of 1999 were 10%, compared to 8% for both periods of 1998. Atlantis' third quarter selling, general, and administrative ("SG&A") expense was $5.9 million, a decline of 3% from the comparable 1998 period. For the first nine months, SG&A expense in 1999 was $18.9 million compared with $18.4 million for the first nine months of 1998. During the third quarter of 1999, Atlantis' results were favorably impacted by approximately $500,000 of pre-tax items related primarily to improved safety experience, favorable settlement of a potential claim, and receipt of a special vendor rebate. Net debt (total debt less cash) was $81.6 million as of September 30, 1999, reflecting a decline of $2.6 million for the first nine months of 1999 including a decline of $1.6 million during the third quarter of 1999. Net interest expense for the third quarter of 1999 was $2.2 million compared with $2.6 million in the third quarter of 1998. For the year to date period, net interest expense totaled $6.8 million in 1999 and $8.0 million in 1998. For the third quarter of 1999, net sales in Atlantis' films segment were $44.7 million compared with $44.3 million for the third quarter of 1998. In the third quarter of 1999, stretch film volume declined 7% from the comparable 1998 period due to inventory corrections in the market. Despite this volume decline, Atlantis' stretch film operating margins in the third quarter of 1999 improved over 1998 third quarter levels. Gross margins in plastic films for the third quarter and year to date periods were 19% and 21% respectively, compared to 20% for both periods of 1998. Operating margins in plastic films were 10% and 11% for the third quarter and year to date periods, compared with 11% and 10%, respectively, in 1998. Sales volume in Atlantis' molded products segment totaled $20.4 million, an increase of 9.3% over the third quarter of 1998, reflecting new business generated in Atlantis' injection molding business as well as strong demand in the nation's appliance sector. On a year-to-year basis, molded products sales totaled $59.2 million compared with $57.9 million in 1998. Gross margins in this segment improved to 19% for both the third quarter and first nine months of 1999, compared with 11% and 13%, respectively, in 1998. Operating margins for the third quarter and first nine months of 1999 improved to 10% and 9% compared to 1% and 4% in 1998. 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 Class A and Class B common shares then outstanding. Through September 30, 1999, the Company repurchased 542,544 shares, as well as options for 55,125 shares for a total consideration of $5.1 million. As previously announced, in October 1999 the Company repurchased 155,100 shares in a private transaction. Since that repurchase, the Company has repurchased through market transactions an additional 7,784 shares. The total consideration paid for the 162,884 shares repurchased since September 30, was $2.3 million, or $14.27 per share. Anthony F. Bova, President and Chief Executive Officer, said, "We continue to be very pleased with our operating results. The turnaround in our injection molding business continues unabated and this business contributed strongly to the improvement in our operating results this past quarter. We recently secured three significant pieces of new business in injection molding which should contribute to our performance in 2000 and beyond. It is clear that our operating team has completed a major turnaround, and is now starting to grow through new business generation, product development, and further automation and cost reduction efforts. We continue to make excellent progress on our films segment expansion activities. We are negotiating a lease for our previously announced West Coast stretch film facility and expect delivery of a new 120" five layer stretch film line to our Sepulpa, OK facility later this year. We have completed the retrofit of two custom film monolayer lines in Mankato, MN to coextrusion and expect to retrofit a third line this quarter." 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. Forward-looking statements may include, but are not limited to, projections of revenues, income or losses, capital expenditures, plans for future operations, financing needs of plans, compliance with financial covenants in loan agreements, plans for liquidation or sale of assets or businesses, plans relating to products or services of the Company, assessments of materiality, predictions of future events, the ability to obtain additional financing, the Company's ability to meet obligations as they become due, the impact of pending and possible litigation, as well as assumptions relating to the foregoing. In addition, when used in this discussion, the words "anticipates," "believes," "estimates," "expects," "intends," "plans" and similar expressions are intended to identify forward-looking statements. Forward-looking statements are inherently subject to risks and uncertainties, including, but not limited to, the impact of leverage, dependence on major customers, fluctuating demand for the Company's products, risks in product and technology development, fluctuating resin prices, competition, litigation, labor disputes, capital requirements, and other risk factors detailed in the Company's Securities and Exchange Commission filings, some of which cannot be predicted or quantified based on current expectations. Additional information is available on the Internet at http://www.cfonews.com/agh. ### ATLANTIS PLASTICS, INC CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited - in thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, 1999 1998 1999 1998 Net sales $65,104 $62,954 $189,129 $191,461 Cost of sales 52,718 51,949 151,107 158,014 Gross profit 12,386 11,005 38,022 33,447 Selling, general and administrative expenses 5,936 6,092 18,926 18,442 Operating income 6,450 4,913 19,096 15,005 Net interest expense (2,200) (2,592) (6,800) (8,036) Income from continuing operations before income taxes 4,250 2,321 12,296 6,969 Income tax provision (1,720) (961) (5,029) (2,346) Income before extraordinary items 2,530 1,360 7,267 4,623 Extraordinary loss on early extinguishment of debt, net - (390) - (390) Net income $2,530 $ 970 $ 7,267 $ 4,233 Earnings per Common Share (Basic) Income before extraordinary items $0.33 $0.18 $0.96 $0.62 Extraordinary loss on early extinguishment of debt, net - (0.05) - (0.05) Net income $0.33 $0.13 $0.96 $0.57 Weighted-average number of shares 7,591 7,479 7,555 7,413 Earnings per Common Share (Diluted) Income before extraordinary items $0.32 $0.17 $0.92 $0.60 Extraordinary loss on early extinguishment of debt, net - (0.05) - (0.05) Net income $0.32 $0.12 $0.92 $0.55 Weighted -average number of shares 7,976 7,833 7,872 7,736 ATLANTIS PLASTICS, INC CONSOLIDATED BALANCE SHEETS (Unaudited,in thousands) September 30, December 31, 1999 1998 ASSETS Cash and cash equivalents $3,632 $2,879 Accounts receivable, net 32,237 25,801 Inventories 17,226 14,918 Other current assets 5,683 8,376 Current assets 58,778 51,974 Property and equipment, net 62,187 58,403 Goodwill, net of accumulated amortization 46,211 47,390 Other assets 1,140 1,465 Total assets $168,316 $159,232 LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable and accrued expenses $26,557 $22,677 Current portion of long-term debt 3,368 2,538 Current liabilities 29,925 25,215 Long-term debt, less current portion 81,898 84,620 Deferred income taxes 9,911 10,149 Other liabilities 189 544 Total liabilities 121,923 120,528 Commitments and contingencies - - Shareholders' equity: Class A Common Stock, $10 par value, 20,000,000 shares authorized, 4,801,877 and 4,538,054 shares issued and outstanding in 1999 and 1998 480 454 Class B Common Stock, $10 par value, 7,000,000 shares authorized, 2,790,945 and 2,918,043 shares issued and outstanding in 1999 and 1998 279 292 Additional paid-in capital 10,266 9,436 Notes receivable from sale of Common Stock (1,381) (960) Retained earnings 36,749 29,482 Total shareholders' equity 46,393 38,704 Total liabilities and shareholder's equity $168,316 $159,232 SEGMENT/TREND INFORMATION ($ In millions) 1999 1998 --------------------- ----------------------------- Q3 Q2 Q1 Q4 Q3 Q2 Q1 ----- ----- ----- ----- ----- ----- ----- NET SALES Plastic Films $44.7 $44.5 $40.7 $42.7 $44.3 $44.4 $44.9 Molded Plastics 20.4 20.5 18.3 16.7 18.7 19.7 19.5 Total $65.1 $65.0 $59.0 $59.4 $63.0 $64.1 $64.4 EBITDA** $9.0 $9.2 $8.4 $8.6 $7.3 $7.2 $7.7 GROSS PROFIT Plastic Films 19% 21% 22% 22% 20% 20% 19% Molded Plastics 19% 19% 18% 17% 11% 12% 15% Total 19% 20% 21% 21% 17% 17% 18% OPERATING INCOME Plastic Films 10% 11% 12% 12% 11% 9% 9% Molded Plastics 10% 9% 7% 7% 1% 4% 6% Total 10% 10% 10% 10% 8% 8% 8% NET INTEREST EXPENSE $2.2 $2.3 $2.3 $2.4 $2.6 $2.7 $2.7 **Earnings before interest, taxes,depreciation, and amortization End.