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Constar International Inc. Announces 2005 First Quarter Financial Results.

Article Excerpt
PHILADELPHIA -- Constar International Inc. (NASDAQ:CNST) today announced its financial results for the three month period ended March 31, 2005.

Net sales rose 15.4 percent in the first quarter to $221.3 million from $191.7 million for the 2004 first quarter. The growth in net sales reflects the pass-through of increased resin prices, increased shipments of both conventional and custom products in the United States and favorable foreign currency translation. The increased net sales were partially offset by price reductions implemented to extend key long-term contracts and meet competitive pricing as well as reduced volumes in certain European markets due to lower customer demand.

First quarter gross profit was $6.4 million compared to $9.4 million in last year's first quarter. The decrease was primarily due to price concessions implemented to extend key contracts and meet competitive pricing, reduced volumes in Europe and increased costs related to transportation and utilities. These items were partially offset by increased unit sales in the U.S. and resulting operating efficiencies.

Adjusted EBITDA in the first quarter was $11.3 million compared to $14.3 million in last year's first quarter. The decrease in adjusted EBITDA primarily reflects the reduced gross profit.

EBITDA is defined by the Company as net income (loss) before interest expense, provision for income taxes, depreciation and amortization and the cumulative effect of a change in accounting for goodwill. The Company's revolving loan facility adjusts EBITDA for certain non-cash accruals and uses the adjusted EBITDA figure to determine the Company's compliance with certain financial covenants in the revolving loan facility. For the 2005 first quarter, these...