Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. TREDEGAR CORP (850429) 10-K published on Mar 16, 2020 at 8:47 am
Reporting Period: Dec 30, 2019
A public health epidemic, including COVID-19, poses the risk that we or our employees, contractors, suppliers, customers and other business partners may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns that may be requested or mandated by governmental authorities, or that such epidemic may otherwise interrupt or impair business activities. For example, a majority of protective films made by the PE Films’ Surface Protection unit are sold to customers who produce key components for flat panel displays. A significant proportion of that production and fabrication occurs in China. Although we have not had significant issues at our Surface Protection manufacturing plant in Guangzhou, China, there can be no assurance that COVID-19 will not impact our Surface Protection business as a result of the virus’ potential impact on delays in production and transportation in, and other impacts on, the flat panel display industry and its supply chain. While it is not possible at this time to estimate the impact that COVID-19 could have on our Surface Protection unit and the Company’s other business units, the continued
John M. Steitz. Mr. Steitz was elected President and Chief Executive Officer effective March 19, 2019. He previously served as President and Chief Executive Officer of Addivant Corporation, a leading global supplier of antioxidants, intermediates, inhibitors, modifiers, UV stabilizers and other additives to the plastic and rubber industries, from March 2015 until January 2019, as President and Chief Operating Officer of PQ Corporation, a leading worldwide producer of specialty inorganic performance chemicals and catalysts, from October 2013 until March 2015, as President and Chief Executive Officer of Avantor Performance Materials, a global supplier of ultra-high-purity life sciences materials with strict regulatory and performance specifications, from September 2012 until September 2013, as President and Chief Operating Officer of Albemarle from March 2012 until August 2012, and as Chief Operating Officer and Executive Vice President of Albemarle from April 2007 until March 2012.
Earnings before interest, taxes, depreciation and amortization from ongoing operations (“EBITDA from ongoing operations”) is the measure of profit and loss used by the CODM (Tredegar’s President and Chief Executive Officer) for purposes of assessing financial performance. In the fourth quarter of 2019, the Company concluded that “EBITDA from ongoing operations,” instead of “operating profit from ongoing operations,” is the most relevant metric for measuring segment financial performance. EBITDA from ongoing operations is the key profitability metric used by Tredegar’s President and Chief Executive Officer, who was elected by the Tredegar Board of Directors in March 2019. This change resulted in a revision of the Company’s segment disclosures for all periods to report EBITDA from ongoing operations as the measure of segment financial performance. The Company uses sales less freight (“net sales”) as its measure of revenues from external customers at the segment level. This measure is separately included in the financial information regularly provided to the CODM.
During 2019, the Company recorded a deferred tax expense of $1.0 million as a valuation allowance to offset deferred tax assets for loss carryovers at our Hungarian subsidiary that the Company does not believe are more likely than not to be realized before the carryover periods expire. Due to recent favorable earnings trends, the Company reversed a $12.4 million valuation allowance on the net deferred tax assets of its Brazilian subsidiary Terphane Ltda. Because Terphane Ltda. is taxed as a foreign branch for US tax purposes, Tredegar also recorded a related deferred tax liability of $12.4 million for the reduction in foreign tax credits that would result from Terphane Ltda. realizing this net deferred tax asset.
exceed deductible amounts, thereby resulting in the realization of deferred income tax assets. The valuation allowance for asset impairments in foreign jurisdictions where the Company believes it is more likely than not that the deferred income tax asset will not be realized was $0.0 million, $15.8 million and $15.6 million at December 31, 2019, 2018 and 2017, respectively. Due to recent favorable earnings trends, the Company reversed a $12.4 million valuation allowance on the net deferred tax assets of its Brazilian subsidiary Terphane Ltda. Because Terphane Ltda. is taxed as a foreign branch for US tax purposes, Tredegar also recorded a related deferred tax liability of $12.4 million for the reduction in foreign tax credits that would result from Terphane Ltda. realizing this net deferred tax asset.