PGI Reports Third Quarter 2012 Results

                    PGI Reports Third Quarter 2012 Results

PR Newswire

CHARLOTTE, N.C., Nov. 9, 2012

CHARLOTTE, N.C., Nov. 9, 2012 /PRNewswire/ -- Polymer Group, Inc. ("PGI" or
the "Company") reported results of operations for the third quarter and nine
months ended September 29, 2012.

As previously announced, Polymer Group, Inc. finalized the merger with an
affiliate of the Blackstone Group, along with co-investors and certain members
of the Company's management (the "Merger"), on January 28, 2011, and became a
privately held company.

In this press release, prior-year nine month results, which include the
January 2 to January 28, 2011, and January 29 to October 1, 2011, periods,
have been combined. The combined presentation does not comply with United
States generally accepted accounting principles ("GAAP") but is presented
because we believe it provides the most meaningful comparison of our financial
results. Included in the release is a reconciliation of the GAAP presentation
to the combined presentation.

Further, as a result of our new organizational structure and to reflect how
the overall business is now managed, in the second quarter of 2012 we made a
change in our reportable segments to reflect the combination of the United
States and Latin America Nonwovens segments into the Americas Nonwovens
segment.

Third Quarter 2012 Highlights:

  oVolume Growth in Americas and Asia Contributes to Top Line Results

       oTotal sales volumes grew 3.9% compared with the prior-year period,
         and were up 1.7% excluding volumes from the Colombia operations that
         were disrupted in fiscal year 2011. The year-over-year volume growth
         reflected contributions of new capacity in the Americas and Asia,
         combined with improved demand in healthcare and certain industrial
         markets.
       oLower selling prices from the pass-through of lower raw material
         costs, unfavorable market pricing trends, and the impact from the
         unfavorable effect of foreign currency translation were partially
         offset by the underlying volume growth.
       oNet sales for the third quarter of 2012 were $290.1 million compared
         with $315.5 million for the third quarter of 2011 and $296.2 million
         in the second quarter of 2012.

  oProfitability Up on Favorable Raw Material Cost Environment

       oGross profit increased 6.1% year-over-year to $52.0 million for the
         third quarter of 2012 compared with $49.0 million in the third
         quarter of 2011 and was up 12.1% compared to $46.4 million in the
         second quarter of 2012.
       oUnit profit was positively impacted by a more favorable raw material
         environment, resulting in lower raw material costs relative to sales
         prices, as well as by year-over-year efficiencies from operations in
         carded operations in the Americas and continued cost controls that
         resulted in lower SG&A costs. These benefits were somewhat offset by
         increased lease expense associated with the new line in Virginia,
         higher depreciation expense and foreign currency translation compared
         to the prior year period and an out-of-period adjustment for a
         value-added tax ("VAT") liability in China.
       oAdjusted EBITDA for the third quarter of 2012 was $37.2 million
         compared with $35.7 million in the third quarter of 2011 and $29.1
         million in the second quarter of 2012. Adjusted EBITDA, a non-GAAP
         financial measure, is defined and reconciled to net income below.

  oGrowth Investments and New Global Operating Structure are Improving
    Positioning in Highly Competitive Environment

       oNew investments in Suzhou, China and Waynesboro, Virginia contributed
         year-over-year and sequential growth in volume and sales.
       oThe redesigned organizational structure is complete with the new
         "Global Growth & Innovation Group" focused on matching resources with
         existing growth opportunities as well as identifying and developing
         new applications of PGI technologies and capabilities.
       oThe new organizational structure is on pace for $11 million to $13
         million of annualized savings in fiscal year 2013.

  oStrong Cash Generation and Disciplined Working Capital Management
    Continues

       oLiquidity remained strong with cash balances of $95.1 million as of
         quarter end.
       oOperating working capital improved year-over-year to 3.6% of net
         sales as of September 29, 2012 compared with 5.3% of net sales in the
         prior year period.

PGI's chief executive officer, Veronica (Ronee) M. Hagen, stated, "We
demonstrated strong profitability in the third quarter as expected, assisted
by a favorable raw material cost environment, continued improvement in cost
controls and the initial benefits from our new global operating structure. I'm
pleased with the incremental volume gains and sequential growth in the
quarter, particularly in the Americas and Asia, as we continue to navigate
industry overcapacity in the global hygiene markets and foreign currency
headwinds."

THIRD QUARTER 2012 RESULTS

Net sales for the third quarter of 2012 were $290.1 million compared with
$315.5 million for the third quarter of 2011 and $296.2 million in the second
quarter of 2012. The year-over-year volume growth that was primarily achieved
in the healthcare and industrial market segments was more than offset by lower
sales price/mix from the Nonwovens segments and unfavorable foreign currency
translation rates. Foreign currency translation rates negatively impacted
sales by approximately $12.2 million compared with the third quarter of 2011.

Gross profit was $52.0 million for the third quarter of 2012 compared with
$49.0 million in the third quarter of 2011 and $46.4 million in the second
quarter of 2012. Gross profit margin for the quarter was 17.9% compared to
15.7% the prior quarter and 15.5% in the third quarter of 2011. The
year-over-year increase in gross profit was predominately due to higher net
spreads of $5.3 million (difference between the change in raw material costs
and selling price/mix) as raw material costs declined during the quarter,
higher volumes related to the contributions from the new lines in Americas and
Asia (including improvements from the disruption in operations during 2011 at
our Colombia facility), partially offset by an increase in lease expense
associated with the new spunmelt line installed in the U.S., the increase in
depreciation associated with the new spunmelt manufacturing lines in the U.S.
and China, and a $1.3 million out-of-period adjustment recognized in the third
quarter of 2012 associated with a VAT liability in China. Raw material costs
were lower by $30.6 million, partially offset by decreases in sales price/mix
of $25.3 million from the pass-through of lower raw material costs associated
with both index-based selling agreements and market-based pricing trends, and
changes in product mix. Raw material costs decreased through the third quarter
of 2012, but have shown moderate increases to date in the fourth quarter of
2012. As a result, the company expects raw material costs to be a headwind to
profitability in the fourth quarter.

The quarter-over-quarter increase of $5.6 million in gross profit was due
primarily to the more favorable raw material environment, resulting in lower
raw material costs partially offset by a relative increase in selling price
changes due to the effect of competitive selling pressures from excess
industry capacity in several regions. These changes, in addition to the impact
of sales and mix changes from the second quarter of 2012 to the third quarter
of 2012, favorably impacted gross profit by approximately $4.9 million. Sales
volumes were 2.8% higher in the third quarter of 2012 compared with the second
quarter of 2012, contributing to a $1.8 million increase. Increases in
manufacturing costs, primarily due to the previously mentioned out-of-period
adjustment associated with a VAT liability in China, and higher depreciation
expense during the quarter, were offset by favorable foreign currency
movements.

Operating income for the third quarter of 2012 was $17.4 million compared with
operating income of $11.4 million in the third quarter of 2011 and operating
income of $2.6 million in the second quarter of 2012. Of the $6.0 million
year-over-year increase in operating income, net spread resulted in an
improvement of $5.3 million, and the net impact of the increase in volumes
contributed to an increase of $3.7 million. This was partially offset by
higher manufacturing costs in the Americas region of $2.1 million primarily
related to the additional lease expense associated with a new U.S. spunmelt
line, and higher costs in our Asia region of $1.8 million due to the
previously mentioned $1.3 million VAT adjustment and higher costs due to the
qualification of new products on the new healthcare line, partially offset by
improvement in underlying operating efficiencies. Other changes included a
year-over-year decrease in selling, general and administrative costs of $1.5
million, a positive impact of $0.7 million due to a favorable change in
foreign currency, $0.1 million of lower purchase accounting adjustments
associated with 2011 step-up of inventory values, partially offset by $0.3
million due to higher special charges, and a $0.7 million increase in
depreciation and amortization expense that was primarily associated with the
new spunmelt manufacturing lines installed in fiscal 2011. The $1.5 million
year-over-year decrease in selling, general and administrative costs was
principally due to a $1.3 million decrease due to foreign currency movements
and $0.2 million lower spending in other categories due to cost control
initiatives.

Special charges for the third quarter of 2012 were $1.7 million and consisted
of: $0.9 million of employee termination and severance expenses associated
with our plant realignment cost initiatives; and $0.8 million of employee
termination expenses, professional consulting fees, employee relocation and
recruitment fees, and other professional and administrative costs associated
with our internal redesign and restructuring of global operations initiative.

After recognizing $2.6 million of income tax expense, the company reported net
income for the third quarter of 2012 of $1.4 million compared with a net loss
of $9.2 million in the third quarter of 2011 and a net loss of $12.1 million
in the second quarter of 2012.

NINE MONTHS ENDED SEPTEMBER 29, 2012, AND OCTOBER 1, 2011 (COMBINED) RESULTS

Net sales for the nine months ended September 29, 2012 were $881.5 million
compared with $895.6 million for the nine months ended October 1, 2011. The
decrease was due to lower selling prices as a result of lower raw material
costs and unfavorable movements in foreign currency translation rates,
partially offset by higher volumes in the company's Nonwovens segments; of
which $33.2 million was associated with higher volumes at our Colombia
facility compared to the prior year when our facility was impacted by the
flood at the location, with increases in all regions, and higher volumes and
higher price/mix in the Oriented Polymers segment.

Gross profit for the nine months ended September 29, 2012 was $151.6 million
compared with $138.4 million for the nine months ended October 1, 2011. The
increase was primarily the result of the absence of $11.8 million of purchase
accounting adjustments in 2011 primarily associated with the stepped-up
inventory values and higher volume related to the disruption in operations
during 2011 at our Colombia facility, offset by an increase in lease expense
associated with the new spunmelt line installed in the U.S., the increase in
depreciation associated with the new spunmelt manufacturing lines in the U.S.
and China and an out-of-period adjustment recognized in the third quarter of
2012. Net spread resulted in an improvement in gross profit of $5.7 million,
as raw material costs were lower by $43.6 million, but were partially offset
by decreases in sales price/mix of $37.9 million from the pass-through of
lower raw material costs associated with both index-based selling agreements
and market-based pricing trends, and changes in product mix.

The company reported operating income for the nine months ended September 29,
2012 of $37.1 million compared with an operating loss of $24.1 million for the
nine months ended October 1, 2011. Of the $61.2 million improvement in the
year-over-year operating income, $37.4 million was due to lower special
charges, primarily associated with costs resulting from the Merger, partially
offset by the costs resulting from the internal redesign and restructuring of
global operations initiative. The net impact of the increase in volumes due to
the disruptions in fiscal 2011 at our Colombia facility, combined with other
changes in the business, resulted in an increase in operating income due to
volume of $12.8 million. Our net spread resulted in an increase of $5.7
million in 2012 compared to 2011. We incurred $11.8 million of lower purchase
accounting adjustments primarily associated with the 2011 step-up of inventory
values. Manufacturing costs were $6.9 million higher due primarily to $6.2
million of additional lease expense associated with the new spunmelt
manufacturing line in the U.S. and increases in Asia due to the $1.3 million
out-of-period adjustment in the third quarter of 2012 and the qualification of
new products on the new healthcare line in China, partially offset by
improvements in the U.S. carded business and improved operating efficiencies
in Asia. The $7.5 million year-over-year decrease in selling, general and
administrative costs was principally due to a $3.6 million decrease due to
foreign currency movements; $2.7 million of lower incentive and stock
compensation expense; a $1.6 million decrease in salaries and benefits and
employee travel and entertainment expenses due to cost reduction initiatives;
a $0.6 million decrease in volume-related expenses and $0.1 million lower
spending in other categories; partially offset by $1.1 million of higher
outside information services costs.

After recognizing $5.9 million of income tax expense, the company reported a
net loss for the nine months ended September 29, 2012 of $11.0 million
compared with a net loss attributable to PGI of $73.0 million for the nine
months ended October 1, 2011.

FINANCIAL METRICS

Net debt (defined as total debt less cash balances) as of September 29, 2012
was $511.2 million compared with $527.7 million as of December 31, 2011.
Capital expenditures for the third quarter were $10.5 million. Operating
working capital (defined as accounts receivable plus inventories less trade
accounts payable and accrued liabilities) was $41.8 million as of September
29, 2012, or 3.6% of third quarter 2012 annualized sales, compared with $66.5
million as of October 1, 2011, or 5.3% of third quarter 2011 annualized sales.

ADJUSTED EBITDA

Adjusted EBITDA for the third quarter of 2012 was $37.2 million compared with
$35.7 million in the third quarter of 2011 and $29.1 million in the second
quarter of 2012 due primarily to higher volumes in all regions, coupled with
the impact of the pass-through of lower raw material costs on sales/price mix,
offset by the absence of a proforma addback in the prior-year period
reflecting the annualized incremental contribution from the company's Colombia
operations prior to the flood, the impact from the higher lease expense
associated with the company's new line in Waynesboro, Virginia, and the impact
of the Asia VAT adjustment.

NON-GAAP FINANCIAL MEASURES

As more fully described in the company's Annual Report on Form 10-K, the
Merger was accounted for in accordance with GAAP for business combinations.
Accordingly, our accounting for the Merger required that the purchase
accounting treatment of the Merger be "pushed down", resulting in the
adjustment of all of our net assets to their respective fair values as of the
Merger date of January 28, 2011. Although we continued as the same legal
entity after the Merger, the application of push down accounting represents
the termination of the old reporting entity and the creation of a new
reporting entity. Accordingly, the two entities are not presented on a
consistent basis of accounting. As a result, our consolidated financial
statements for 2011 are presented for the period from January 29, 2011 through
October 1, 2011 for the new reporting entity succeeding the Merger (the
"Successor"), and for the period from January 2, 2011 through January 28, 2011
for the old reporting entity preceding the Merger (the "Predecessor"). The
combined presentation in this press release is a "non-GAAP financial measure"
and does not comply with GAAP, but is presented because we believe it provides
the most meaningful comparison of our results. The results of the Successor
are not comparable to the results of the Predecessor due to the difference in
basis of presentation of purchase accounting as compared to historical cost.

Adjusted EBITDA (as defined below) is used in this release as a "non-GAAP
financial measure," which is a measure of the company's financial performance
that is different from measures calculated and presented in accordance with
GAAP within the meaning of applicable Securities and Exchange Commission
rules. A non-GAAP financial measure, such as EBITDA or Adjusted EBITDA, should
not be viewed as an alternative to GAAP measures of performance such as (1)
net income determined in accordance with GAAP or (2) operating cash flows
determined in accordance with GAAP. The calculation of Adjusted EBITDA may not
be comparable to the calculation of similarly titled measures reported by
other companies.

As defined in the company's indenture and credit agreements, Adjusted EBITDA
is generally calculated as net income (loss) before interest expense, income
and franchise taxes and depreciation and amortization, further adjusted to
exclude the effects of currency and certain unusual, non-cash, non-recurring
and other items permitted in calculating covenant compliance under the
indenture governing the Senior Secured Notes and the credit agreement
governing our ABL facility. With certain exceptions, it is also generally
consistent with the metric used by management as a performance measurement for
certain performance-based incentive compensation plans. In addition, the
company considers Adjusted EBITDA an important supplemental measure of its
performance and believes it is frequently used by securities analysts,
investors and other interested parties in the evaluation of companies in its
industry.

Included in this release are reconciliations of the GAAP presentation to the
combined presentation for the nine months ended October 1, 2011 and a
reconciliation of net loss to Adjusted EBITDA, which illustrates the
differences in these measures of operating performance.

Polymer Group, Inc. is a global, technology-driven developer, producer and
marketer of engineered materials, and one of the world's leading producers of
nonwovens. With the broadest range of process technologies in the nonwovens
industry, PGI is a global supplier to leading consumer and industrial product
manufacturers. The company operates 13 manufacturing and converting facilities
in 9 countries throughout the world.

EARNINGS CONFERENCE CALL

PGI will conduct an investor conference call, including presentation slides,
starting at 10:30 a.m. ET on Tuesday, November 13, 2012. A live webcast of the
conference call and presentation material can be accessed by visiting PGI's
investor relations website at www.polymergroupinc.com. The number to call for
the live interactive teleconference is (866) 202-3048 or (617) 213-8843 and
entering the passcode, 74201757. A replay of the conference call will be
available until November 20, 2012, by dialing (888) 286-8010 or (617) 801-6888
and entering the passcode, 63201172. Shortly after the conclusion of the
conference call, a webcast replay will be made available at
www.polymergroupinc.com.

Safe Harbor Statement

Except for historical information contained herein, the matters set forth in
this press release are forward-looking statements, within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, that involve certain risks and uncertainties that could
cause actual results to differ materially from those described in the
forward-looking statements. These forward‑looking statements speak only as of
the date of this release. Important factors that could cause actual results to
differ materially from those discussed in such forward‑looking statements
include: general economic factors including, but not limited to, changes in
interest rates, foreign currency translation rates, consumer confidence,
trends in disposable income, changes in consumer demand for goods produced,
and cyclical or other downturns; cost and availability of raw materials, labor
and natural and other resources and the inability to pass raw material cost
increases along to customers; changes to selling prices to customers which are
based, by contract, on an underlying raw material index; substantial debt
levels and potential inability to maintain sufficient liquidity to finance our
operations and make necessary capital expenditures; the ability to meet
existing debt covenants or obtain necessary waivers; achievement of objectives
for strategic acquisitions and dispositions; the ability to achieve successful
or timely start-up of new or modified production lines; reliance on major
customers and suppliers; domestic and foreign competition; information and
technological advances; risks related to operations in foreign jurisdictions;
and changes in environmental laws and regulations, including climate
change-related legislation and regulation. Investors and other readers are
directed to consider the risks and uncertainties discussed in documents filed
by Polymer Group, Inc. with the Securities and Exchange Commission, including
the company's Annual Report on Form 10-K and subsequent Quarterly Reports on
Form 10-Q.

POLYMER GROUP, INC.
Consolidated Statements of Operations (Unaudited)
Three Months Ended September 29, 2012,
Three Months Ended June 30, 2012, and
Three Months Ended October 1, 2011
(In Thousands)
                                  Successor
                                  Three Months     Three Months  Three Months
                                  Ended           Ended        Ended
                                  September 29,    June 30,      October 1,
                                  2012            2012         2011
Net sales                        $           $        $     
                                  290,097          296,244       315,498
Cost of goods sold               238,123          249,825       266,509
Gross profit                     51,974           46,419        48,989
Selling, general and              33,044           35,180        34,516
administrative expenses
Special charges, net             1,732            8,753         1,399
Other operating (income) loss,    (235)            (159)         1,691
net
Operating income                  17,433           2,645         11,383
Other expense:
 Interest expense, net        12,487           12,738        12,866
 Foreign currency and other    999              3,160         2,886
loss, net
Income (loss) before income tax
expense and discontinued          3,947            (13,253)      (4,369)
operations
Income tax expense (benefit)      2,593            (1,159)       936
Income (loss) from continuing     1,354            (12,094)      (5,305)
operations
Discontinued operations:
 Loss from operations of       -                -             (3,363)
discontinued business
 Loss on sale of discontinued  -                -             (520)
operations
Loss from discontinued            -                -             (3,883)
operations, net of tax
Net income (loss)                 $         $        $      
                                  1,354            (12,094)      (9,188)



POLYMER GROUP, INC.
Consolidated Statements of Operations (Unaudited)
Nine Months Ended September 29, 2012,
Eight Months Ended October 1, 2011 and
One Month Ended January 28, 2011
(In Thousands)
                                Successor                      Predecessor
                                Nine Months     Eight Months   One Month Ended
                                Ended          Ended         January 28,
                                September 29,  October 1,    2011
                                2012           2011
Net sales                      $          $         $      
                                881,512         810,992        84,606
Cost of goods sold             729,932         688,683        68,531
Gross profit                   151,580         122,309        16,075
Selling, general and            102,354         98,338         11,564
administrative expenses
Special charges, net           12,904          29,467         20,824
Other operating (income) loss,  (754)           2,892          (564)
net
Operating income (loss)         37,076          (8,388)        (15,749)
Other expense:
 Interest expense, net      38,074          33,513         1,922
 Foreign currency and other  4,095           4,249          82
loss, net
Loss before income tax expense  (5,093)         (46,150)       (17,753)
and discontinued operations
Income tax expense              5,912           1,614          549
Loss from continuing            (11,005)        (47,764)       (18,302)
operations
Discontinued operations:
 (Loss) income from
operations of discontinued      -               (6,192)        182
business
 Loss on sale of             -               (735)          -
discontinued operations
(Loss) income from discontinued -               (6,927)        182
operations, net of tax
Net loss                        (11,005)        (54,691)       (18,120)
Net income attributable to      -               (59)           (83)
noncontrolling interests
Net loss attributable to        $          $         $     
Polymer Group, Inc.           (11,005)        (54,750)       (18,203)



POLYMER GROUP, INC.
Consolidated Statements of Operations (Unaudited)
Combined*
(In Thousands)
                                    Predecessor      Successor    Combined*
                                    January 2, 2011  January 29,  January 1,
                                                     2011         2011
                                    to
                                    January 28,     to           to
                                                     October 1,   October 1,
                                    2011             2011        2011
Net sales                          $          $       $     
                                    84,606           810,992      895,598
Cost of goods sold                 68,531           688,683      757,214
Gross profit                       16,075           122,309      138,384
Selling, general and                11,564           98,338       109,902
administrative expenses
Special charges, net               20,824           29,467       50,291
Other operating (income) loss,      (564)            2,892        2,328
net
Operating loss                      (15,749)         (8,388)      (24,137)
Other expense:
 Interest expense, net          1,922            33,513       35,435
 Foreign currency and other      82               4,249        4,331
loss, net
Loss before income tax expense and  (17,753)         (46,150)     (63,903)
discontinued operations
Income tax expense                 549              1,614        2,163
Loss from continuing operations    (18,302)         (47,764)     (66,066)
Discontinued operations:
 Income (loss) from operations   182              (6,192)      (6,010)
of discontinued business
 Loss on sale of discontinued    -                (735)        (735)
operations
Income (loss) from discontinued     182              (6,927)      (6,745)
operations, net of tax
Net loss                            (18,120)         (54,691)     (72,811)
Net income attributable to          (83)             (59)         (142)
noncontrolling interests
Net loss attributable to Polymer    $           $       $     
Group, Inc.                       (18,203)         (54,750)     (72,953)



P O L Y M E R G R O U P, I N C.
Condensed Consolidated Balance Sheets
(In Thousands)
                                               (Unaudited)
                                               September 29,     December
                                                                   31,
                                               2012                2011
A S S E T S
Current assets:
    Cash and cash equivalents                $              $     
                                               95,099              72,742
    Accounts receivable, net                 131,331             141,172
    Inventories, net                         98,809              103,911
    Other current assets                     42,619              40,448
                 Total current assets        367,858             358,273
Property, plant and equipment, net           482,002             493,352
Goodwill and intangible assets, net          157,794             164,297
Other noncurrent assets                      42,916              44,656
    Total assets                             $   1,050,570     $  
                                                                   1,060,578
L I A B I L I T I E S A N D S H A R E H O
L D E R S' E Q U I T Y
Current liabilities:
    Accounts payable and accrued              $     188,335   $    
    liabilities                                                   190,516
    Current portion of long-term debt
     and short-term borrowings            12,596              12,592
    Other current liabilities                4,614               2,714
                 Total current                205,545             205,822
                 liabilities
Long-term debt                               593,725             587,853
Other noncurrent liabilities                 75,358              79,606
    Total liabilities                        874,628             873,281
    Total equity                             175,942             187,297
    Total liabilities and equity             $   1,050,570     $  
                                                                   1,060,578



P O L Y M E R G R O U P, I N C.
Selected Financial Data (Unaudited)
(In Thousands)
                                    Successor
                                    Three         Three        Three
                                    Months        Months       Months
                                    Ended        Ended       Ended
                                    September     June 30,    October 1,
                                    29,
                                    2012           2012          2011
Selected Financial Data
Depreciation and amortization      $        $        $     
expense included in operating         16,402        15,840     15,798
income
Noncash compensation costs         $        $        $     
included in operating income            207               
                                                   209           206
Amortization of loan               $        $        $     
acquisition costs                       686               
                                                   685           684
Capital expenditures              $        $        $     
                                      10,516        16,318     20,172
U.S. manufacturing line            $        $        $     
operating lease expense               2,067                   
                                                   2,067           -
Special charges, net
Restructuring and plant            $        $        $     
realignment costs                     1,753                   
                                                   8,311         262
Blackstone Acquisition Costs      2              89            909
Colombia flood                    -              -             36
Other                             (23)           353           192
                                    $        $        $     
Special charges, net                 1,732                 
                                                   8,753         1,399
Other operating (income) loss,
net including Foreign Currency
(Income) Loss
                                    $        $        $     
Americas Nonwovens                    (302)              
                                                   (57)          (366)
Europe Nonwovens                  (218)          443           (94)
Asia Nonwovens                    (187)          (189)         -
Oriented Polymers                 458            (346)         -
Unallocated Corporate, net of      14             (10)          2,151
eliminations
Other operating (income) loss,     $        $        $     
net including Foreign Currency          (235)              
(Income) Loss                                     (159)         1,691
Adjusted EBITDA
The following table reconciles
Adjusted EBITDA to net loss for
the periods presented:
                                    $        $        $     
Net loss                             1,354      (12,094)    
                                                                 (9,188)
Loss from discontinued             -              -             3,363
operations
Loss from sale of discontinued     -              -             520
operations
Interest expense, net             12,487         12,739        12,866
Income and franchise tax           2,661          (1,005)       962
expense (benefit
Depreciation & amortization       16,402         15,840        15,764
Adjustments resulting from
application from purchase           191            254           383
accounting
Non-cash compensation             202            215           205
Special charges                   1,732          8,753         1,399
Foreign currency and other         764            3,000         4,776
non-operating loss, net
Severance and relocation           200            410           836
expenses
Unusual or non-recurring           305            -             (36)
charges, net
Business optimization              137            286           171
expense
Management, monitoring and         750            750           812
advisory fees
Annualized incremental
contribution from Cali, Colombia    -              -             2,891
spunmelt lines
Adjusted EBITDA                   $        $        $     
                                      37,185        29,148     35,724



                                                                Combined*
                                               Nine Months    Nine Months
                                               Ended          Ended
                                               September 29,  October 1,
                                               2012             2011
Selected Financial Data
Depreciation and amortization expense         $         $      
included in operating income                   47,410           42,578
Noncash compensation costs included in        $         $      
operating income                                  620        14,278
Amortization of loan acquisition costs       $         $      
                                                 2,056           1,896
Capital expenditures                         $         $      
                                                40,146           62,161
U.S. manufacturing line operating lease       $         $      
expense                                         6,202              
                                                                -
Special charges, net
Restructuring and plant realignment           $         $      
costs                                          11,811            1,507
Blackstone Acquisition Costs                 452              32,459
Accelerated vesting of share-based            -                12,694
awards
Colombia flood                               57               2,360
Other                                        584              1,271
Special charges, net                         $         $      
                                                12,904           50,291
Other operating (income) loss, net
including Foreign Currency (Income) Loss
Americas Nonwovens                           $         $      
                                                  (609)          (235)
Europe Nonwovens                             36               (279)
Asia Nonwovens                               (314)            -
Oriented Polymers                            133              -
Unallocated Corporate, net of                 -                2,842
eliminations
Other operating (income) loss, net            $         $      
including Foreign Currency (Income) Loss         (754)         2,328
Adjusted EBITDA
The following table reconciles Adjusted
EBITDA to net loss for the periods
presented:
Net loss                                     $         $      
                                               (11,005)          (72,953)
(Income) loss from discontinued               -                6,010
operations
Loss from sale of discontinued                -                735
operations
Net income attributable to noncontrolling     -                142
interest
Interest expense, net                        38,074           35,435
Income and franchise tax expense             6,150            2,600
Depreciation & amortization                  47,410           42,470
Adjustments resulting from application        706              14,632
from purchase accounting
Non-cash compensation                        621              1,606
Special charges                              12,904           50,291
Foreign currency and other non-operating      3,343            7,192
loss, net
Severance and relocation expenses            1,377            1,984
Unusual or non-recurring charges, net        411              511
Business optimization expense                842              408
Management, monitoring and advisory           2,250            2,187
fees
Impact of the Spain lease                    -                419
Annualized incremental contribution from      -                13,358
Cali, Colombia spunmelt lines
Public company costs                        -                183
Adjusted EBITDA                              $         $      
                                               103,083           107,210



                                              Last Twelve    Last Twelve
                                              Months Ended   Months Ended
                                              September 29,  December 31,
Adjusted EBITDA                             2012             2011
The following table reconciles Adjusted
EBITDA to net loss for the periods
presented:
Net loss                                    $         $      
                                              (32,424)          (94,374)
(Income) loss from discontinued              (645)            5,365
operations
Loss from sale of discontinued               -                735
operations
Net income attributable to                   -                141
noncontrolling interest
Interest expense, net                       50,969           48,330
Income and franchise tax benefit            1,272            (2,278)
Depreciation & amortization                 63,063           58,124
Adjustments resulting from application       1,947            15,873
from purchase accounting
Non-cash compensation                       802              1,787
Special charges                             24,782           62,170
Foreign currency and other non-operating     17,665           21,514
loss, net
Severance and relocation expenses           1,797            2,403
Unusual or non-recurring charges, net       1,189            1,287
Business optimization expense               954              523
Management, monitoring and advisory          3,063            3,000
fees
Impact of the Spain lease                   -                419
Annualized incremental contribution from     2,334            15,692
Cali, Colombia spunmelt lines
Public company costs                       -                183
Adjusted EBITDA                             $         $      
                                              136,768           140,894

SOURCE Polymer Group, Inc.

Website: http://www.polymergroupinc.com
Contact: Dennis Norman, Chief Financial Officer, +1-704-697-5186,
normand@pginw.com, Cliff Bridges, Sr. Director, Corporate Communications,
+1-704-697-5168, bridgesc@pginw.com