U.S. Plastic Lumber reported revenues for the fourth quarter and fiscal year this week. According to the company, revenues for the quarter were $37.8 million compared with $49 million for the same quarter in 2000, a 23 percent drop.
Revenues from the plastic lumber division were $10.3 million, compared with $13.9 million for the same quarter in 2000. The division's revenues were down primarily due to the impact of exiting the resin trading business.
Revenues from the environmental recycling division during the quarter were $27.5 million, compared with $35.1 for the same quarter in 2000. The decrease was primarily due to the timing of project work in the construction and remediation services groups.
USPL reported a loss for the quarter of $21.6 million, compared with a loss of $8.3 million the same time in 2000. The quarter operating results include $18 million of one-time charges; an increase in the environmental recycling division's allowance for doubtful accounts of $3.2 million related to work performed in 1999 and 2000 that is in dispute with a governmental agency; and a $1.3 million charge in connection with a judgement against USPL.
Revenues for the year were $174.1 million compared to $173.7 million for 2000. Revenues for the plastic lumber division for the year were $57.8 million compared with $73.2 million for 2000. The plastic division's revenues were below last year's revenues primarily due to the impact of exiting the resin trading business.
Revenues for the environmental recycling division improved during 2001 primarily due to the completion of larger projects in the construction and dredge recycling operations.
USPL reported an operating loss for the year of $34.6 million, compared with an operating loss of $5.9 million in 2000. The operating loss was impacted by restructuring and asset impairment charges of $25 million. The charges consist of a $13.5 million asset impairment charge for the recycling division and an $11.5 million charge recorded in the third quarter in connection with the final stage of the plastic lumber division's restructuring plan.
Mark Alsentzer, chairman, CEO and president of USPL said, ``During 2001, we have spent most of our time reducing costs in the plastic lumber division by consolidating ten of our smaller plants into three larger plants. This restructuring plan is near completion. At the same time we have been working to reduce our debt by entering into an agreement to sell our environmental recycling division, Clean Earth Inc. We expect to close this transaction during the second quarter of 2002.''
Following the quarterly announcement, a report by Dow Jones, notes that the company’s auditor, KPMG LLP, said it has substantial doubt about the company's ability to continue as a going concern because it hasn't been able to make debt payments as they've come due.
U.S. Plastic has a working capital deficiency of $60.5 million as of Dec. 31, 2001, and hasn't made principal or interest payments on its debt since missing payments last September, according to its annual report filed with the Securities and Exchange Commission earlier this week.
U.S. Plastic Lumber had been counting on proceeds from the sale of its Clean Earth unit to repay $42.7 million in debt but the company said it continues to act as if the sale won't happen because the buyer hasn't met the terms for closing the deal.
If the unit sale doesn't close, U.S. Plastics will negotiate with its creditors and potential new lenders to establish an alternative refinancing plan, the filing said.
"In this event, we may be forced to seek protection under the bankruptcy bode or we may be forced into a bankruptcy proceeding by these lenders," the company said in the filing.