Royal Group Announces Additional Portfolio Restructuring
October 18 2005 - 9:30AM
PR Newswire (US)
TORONTO, Oct. 18 /PRNewswire-FirstCall/ -- Royal Group Technologies
Limited (RYG-TSX; RYG-NYSE) announced today that it has decided to
further restructure its business unit portfolio in pursuit of
enhanced shareholder value. Today's announcement is pursuant to
previous news releases, in which Royal Group has noted that
business unit portfolio restructuring is one element of its
four-part management improvement plan. On July 28, Royal Group
announced that it intended to divest of its Royal Alliance, Baron
Metal, Roadex Transport and Polish subsidiaries. Today, Royal Group
announced that it intends to divest of Royal Ecoproducts Co., a
producer of recycled polypropylene compounds. Royal Ecoproducts
primarily supplies these compounds to Royal Dynamics Limited, which
is another wholly owned subsidiary of Royal Group engaged in
injection molding of various building products. The decision to
divest Royal Ecoproducts recognizes its continuing financial
underperformance, as well as the fact that the compounds it
manufactures are available from other companies. During the twelve
months ended December 31, 2004, Royal Ecoproducts recorded an
EBITDA loss of $5.2 million. About Royal Group Technologies Royal
Group Technologies Limited is a manufacturer of innovative,
polymer-based home improvement, consumer and construction products.
The company has extensive vertical integration, with operations
dedicated to provision of materials, machinery, tooling, real
estate, and transportation services to its plants producing
finished products. Royal's manufacturing facilities are primarily
located throughout North America, with international operations in
South America, Europe and Asia. Additional investment information
is available on Royal Group's web site at
http://www.royalgrouptech.com/ under the "Investor Relations"
section. The information in this document contains certain
forward-looking statements with respect to Royal Group Technologies
Limited, its subsidiaries and affiliates. These statements are
often, but not always made through the use of words or phrases such
as "expect", "should continue", "continue", "believe",
"anticipate", "suggest", "estimate", "contemplate", "target",
"plan", "budget", "may", "will", "schedule" and "intend" or similar
formulations. By their nature, these forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable by management, are inherently subject
to significant, known and unknown, business, economic, competitive
and other risks, uncertainties and other factors affecting Royal
specifically or its industry generally that could cause actual
performance, achievements and financial results to differ
materially from those contemplated by the forward-looking
statements. These risks and uncertainties include the ongoing
shareholder value maximization process and its outcome; the ongoing
internal review and investigations by the Special Committee of the
Board of Directors and its outcome; the outcome of the ongoing
assessment and review of the Royal Building System's compliance
with the smoke generated elements of the US building code and the
safety of buildings constructed with the Royal Building System;
fluctuations in the level of renovation, remodeling and
construction activity; changes in product costs and pricing; an
inability to achieve or delays in achieving savings related to the
cost reductions or increases in revenues related to sales price
increases; the sufficiency of our restructuring activities,
including the potential for higher actual costs to be incurred in
connection with restructuring activities compared to the estimated
costs of such actions; the ability to recruit and retain qualified
employees; the level of outstanding debt and our current debt
ratings; Royal's ability to maintain adequate liquidity and
refinance its debt structure by April 30, 2006, the expiry date of
its current bank credit facility; the ability to meet the financial
covenants in our credit facilities; changes in product mix; the
growth rate of the markets into which Royal's products are sold;
market acceptance and demand for Royal's products; changes in
availability or prices for raw materials; pricing pressures
resulting from competition; difficulty in developing and
introducing new products; failure to penetrate new markets
effectively; the effect on foreign operations of currency
fluctuations, tariffs, nationalization, exchange controls,
limitations on foreign investment in local business and other
political, economic and regulatory risks; difficulty in preserving
proprietary technology; adverse resolution of any litigation,
investigations, administrative and regulatory matters, intellectual
property disputes, or similar matters; changes in securities or
environmental laws, rules and regulations; currency risk exposure
and other risks described from time to time in publicly filed
disclosure documents and securities commission reports of Royal
Group Technologies Limited and its subsidiaries and affiliates. In
view of these uncertainties we caution readers not to place undue
reliance on these forward-looking statements. Statements made in
this document are made as of October 18, 2005 and Royal disclaims
any intention or obligation to update or revise any statements made
herein, whether as a result of new information, future events or
otherwise. DATASOURCE: Royal Group Technologies Limited CONTACT:
James Lawn, Chief Financial Officer, Royal Group Technologies
Limited, Phone (905) 264-0701
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