BMO: Though Glatfelter CFO transition isn't related to company's operations, change comes at 'sensitive' point, with near-term challenges; bullish on company's recent spunlace and airlaid deals, which will benefit EBITDA and free cash flow over time

Sample article from our Chemicals Industry

LOS ANGELES , April 4, 2022 () –

In a note on April 4, BMO's Mark Wilde says Glatfelter CFO Hillard’s departure hits Glatfelter at a sensitive point, citing company's levered balance sheet after two large acquisitions in 2021. rising natural gas costs and Ukrainian war impacting wallcovering business in the region.

Nonetheless, Wilde is bullish on company's recent acquisitions in Spunlace and Airlaid which he expects to benefit EBITDA and free cash flow over time.

Earlier on March 28, Wilde noted that the pending merger of Schweitzer-Mauduit and Neenah, both with business interests in engineered materials, creating pro forma EBITDA of US$450M post synergies, would increase focus on industry consolidation and on Glatfelter's position as a small cap player in engineered materials.

In a April 4 report, Global Data publishes a SWOT analysis on Glatfelter, stating the following:

Strengths

  • Focus on Quality
  • Manufacturing Capabilities

Weaknesses

  • Overdependence on Germany

Opportunities

  • Rising Demand for Lightweight Packaging
  • Growing Role of Flexible Packaging

Threats

  • Increasing Raw Material Cost Regulations

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