Mr. Martin continued, "We are very pleased with the Company's performance in 2012. Despite three strong years since the economic crisis of 2008 and 2009, we still expect top line progress and bottom-line improvement to continue in 2013. Our order intake levels have been very solid so far in the current quarter. Foreign currency markets remain high on our watch list with 95% of our revenues derived from outside Canada and there are some early signs of returning commodity inflation."
Mr. Martin also stated, "The Company finished the year with a robust balance sheet, $189 million of cash on hand and a net debt to total book capitalization of 13.6%. We have renegotiated our credit facilities in light of the planned Avery Dennison transaction with a $700 million package to finance the acquisition and provide for future flexibility. On a pro-forma basis, we still expect our net debt to EBITDA ratio to remain well below 2 times following the integration of the Avery Dennison business. Given our prospects for the coming year and the Company's commitment to increasing total shareholder return, your Board of Directors has declared an increase in the quarterly dividend of $0.02 per share, equating to 10.3% on the Class B shares. The new quarterly dividend of $0.215 per Class B non-voting share and $0.2025 per Class A voting share will be payable to shareholders of record at the close of business on March 15, 2013, to be paid on March 28, 2013. CCL has delivered dividends to shareholders without omission or reduction for over 30 years."
Mr. Martin concluded, "We remain very excited about the possibilities of our previously announced acquisition of Avery Dennison's Office & Consumer Products and Designed & Engineered Solutions businesses. Our integration planning activities are progressing and subject to regulatory approval, we still expect the transaction to close by mid-2013."
With headquarters in Toronto, Canada, CCL Industries now employs approximately 6,600 people and operates 74 production facilities globally located to meet the sourcing needs of large international customers. CCL Label is the world's largest converter of pressure sensitive and film materials for label applications and sells to leading global customers in the consumer packaging, healthcare, automotive and consumer durable markets. CCL Container and CCL Tube are leading producers of aluminum aerosol cans, bottles and extruded plastic tubes for consumer packaged goods customers in the United States, Canada and Mexico.
(1) EBITDA is a critical non-IFRS financial measure used extensively in the packaging industry and other industries to assist in understanding and measuring operating results. It is also considered as a proxy for cash flow and a facilitator for business valuations. This non-IFRS financial measure is defined as earnings before net finance cost, taxes, depreciation and amortization, goodwill impairment loss, earnings in equity accounted investments and restructuring and other items. See section entitled "Supplementary Information" below for a reconciliation of operating income to EBITDA. The Company believes that it is an important measure as it allows management to assess CCL's ongoing business without the impact of net finance cost, depreciation and amortization and income tax expenses, as well as non-operating factors and one-time items. As a proxy for cash flow, it is intended to indicate CCL's ability to incur or service debt and to invest in property, plant and equipment, and it allows management to compare CCL's business to those of CCL's peers and competitors who may have different capital or organizational structures. EBITDA is a measure tracked by financial analysts and investors to evaluate financial performance and is a key metric in business valuations. EBITDA is considered an important measure by lenders to the Company and is included in the financial covenants of CCL's senior notes and bank lines of credit.(2) Operating Income is a key non-IFRS financial measure used to assist in understanding the profitability of the Company's business units. This non-IFRS financial measure is defined as income before corporate expenses, net finance cost, goodwill impairment loss, earnings in equity accounted investments, restructuring and other items and taxes.(3) Adjusted Basic Earnings per Class B Share is an important non-IFRS financial measure used to assist in understanding the ongoing earnings performance of the Company excluding items of a one-time or non- recurring nature. It is not considered a substitute for basic net earnings per Class B share but it does provide additional insight into the ongoing financial results of the Company. This non-IFRS financial measure is defined as basic net earnings per Class B share excluding gains on dispositions, goodwill impairment loss, restructuring and other items and tax adjustments.