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Archive for March, 2011

AEP Industries Inc. Reports Fiscal 2011 First Quarter Results

Monday, March 14th, 2011

South Hackensack, NJ, March 14, 2011 – AEP Industries Inc. (Nasdaq: AEPI, the “Company”
or “AEP”) today reported financial results for its first quarter ended January 31, 2011.

Net sales for the first quarter of fiscal 2011 increased $60.5 million, or 38.5%, to
$217.7 million from $157.2 million for the first quarter of fiscal 2010. The increase was the
result of a 9% increase in average selling prices primarily attributable to higher resin costs
during the comparable periods, positively affecting net sales by $13.7 million, combined with a
27% increase in sales volume positively affecting net sales by $46.1 million. The first quarter
of fiscal 2011 also included a $0.7 million positive impact of foreign exchange relating to the
Company’s Canadian operations.

Gross profit for the first quarter of 2011 increased $11.5 million, or 63.5%, to $29.5 million
from $18.0 million in the same quarter of the prior fiscal year. The Company experienced a
$4.1 million increase in the LIFO reserve during the first quarter of fiscal 2011 versus a $2.1
million increase in the LIFO reserve during the first quarter of fiscal 2010, representing an
increase of $2.0 million year-over-year. Excluding the effects of the LIFO reserve increase,
gross profit increased $13.5 million primarily due to increased sales volumes and improved
plant utilization, partially offset by a lag in selling price increases during the period. The first
quarter of fiscal 2011 also included a $0.3 million decrease of consulting costs associated with
the implementation of the Company’s new operating system. The effect of foreign exchange
on gross profit during the first quarter of 2011 was a positive impact of $0.2 million relating to
the Company’s Canadian operations.

Operating expenses for the first quarter of fiscal 2011 increased $2.1 million, or 9.6%, to
$24.5 million from the comparable period in the prior fiscal year. The increase in operating
expenses is primarily due to increased volumes sold in the current period increasing delivery
and selling expenses by $2.8 million, partially offset by a decrease of $0.3 million related

to share-based compensation costs associated with the Company’s stock options and
performance units and a $0.2 million decrease of consulting costs associated with the
implementation of the Company’s new operating system. The remaining decrease reflects the
positive effects of the Company’s ongoing effort in cost cutting initiatives. The first quarter of
fiscal 2011 also includes a $0.1 million unfavorable effect of foreign exchange relating to the
Company’s Canadian operations.

“We delivered strong first quarter results during what is typically a seasonally slow period,”
said Brendan Barba, Chairman and Chief Executive Officer of the Company. “As expected,
high sales volume trends continued as we entered fiscal 2011, with volumes up significantly
during the quarter compared to a year ago, and we anticipate continued improvement in
volumes going forward. Our first quarter results also reflect a leaner and more efficient
organization resulting from various cost cutting initiatives that have streamlined the
organization’s operations. AEP entered fiscal 2011 from a position of financial strength and
we are confident that the strategies implemented during more challenging economic times will
continue to benefit our company going forward.”

Interest expense for the three months ended January 31, 2011 increased $0.1 million as
compared to the prior year period, resulting primarily from higher average borrowings on the
Company’s Credit Facility.

Net income for the three months ended January 31, 2011 was $1.1 million, or $0.17 per
diluted share, as compared to a net loss of $4.9 million, or $(0.72) per diluted share, for the
three months ended January 31, 2010.

Adjusted EBITDA (defined below) was $15.1 million in the current quarter as compared to
$4.3 million for the three months ended January 31, 2010.

Reconciliation of Non-GAAP Measures to GAAP

The Company defines Adjusted EBITDA as income (loss) before discontinued operations,
interest expense, income taxes, depreciation and amortization, changes in LIFO reserve,
other non-operating income (expense) and non-cash share-based compensation expense
(income). The Company believes Adjusted EBITDA is an important measure of operating
performance because it allows management, investors and others to evaluate and compare
its core operating results, including its return on capital and operating efficiencies, from
period to period by removing the impact of its capital structure (interest expense from its
outstanding debt), asset base (depreciation and amortization), tax consequences, changes in
LIFO reserve (a non-cash charge/benefit to its consolidated statements of operations), other
non-operating items and non-cash share-based compensation. Furthermore, management

uses Adjusted EBITDA for business planning purposes and to evaluate and price potential
acquisitions. In addition to its use by management, the Company also believes Adjusted
EBITDA is a measure widely used by securities analysts, investors and others to evaluate
the financial performance of the Company and other companies in the plastic films industry.
Other companies may calculate Adjusted EBITDA differently, and therefore the Company’s
Adjusted EBITDA may not be comparable to similarly titled measures of other companies.

Adjusted EBITDA is not a measure of financial performance under U.S. generally accepted
accounting principles (GAAP), and should not be considered in isolation or as an alternative
to net income (loss), cash flows from operating activities and other measures determined in
accordance with GAAP. Items excluded from Adjusted EBITDA are significant and necessary
components to the operations of the Company’s business, and, therefore, Adjusted EBITDA
should only be used as a supplemental measure of the Company’s operating performance.

The following is a reconciliation of the Company’s net income (loss), the most directly
comparable GAAP financial measure, to Adjusted EBITDA:

The Company invites all interested parties to listen to its first quarter conference call live over
the Internet at www.aepinc.com on March 15, 2011, at 10:00 a.m. ET or by dialing 888-802-
8577 for domestic participants or 404-665-9928 for international participants and referencing
passcode 47559604. An archived version of the call will be made available on the Company’s
website after the call is concluded and will remain available for one year.

AEP Industries Inc. manufactures, markets, and distributes an extensive range of plastic
packaging products for the consumer, industrial and agricultural markets. The Company has
manufacturing operations in the United States and Canada.

Except for historical information contained herein, statements in this release 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 include, but are not limited to,
risks associated with resin and product pricing, volume, resin availability, our new operating
system, our liquidity and market conditions generally, including the continuing impacts of the
U.S. recession and the global credit and financial crisis. Those and other risks are described
in the Company’s annual report on Form 10-K for the year ended October 31, 2010, filed with
the Securities and Exchange Commission (SEC), copies of which are available from the SEC
or may be obtained from the Company. Except as required by law, the Company assumes no
obligation to update the forward-looking statements, which are made as of the date hereof,
even if new information becomes available in the future.

AEP Industries Fiscal 2011 First Quarter Earnings Conference Call

Friday, March 4th, 2011

The AEP Industries fiscal 2011 first quarter earnings Conference Call is scheduled for Tuesday, March 15th at 10:00 am.

Click here to access the call.