~ Achieved significant merger milestone with expiration of HSR waiting period ~ 2024 First Quarter Highlights: Generated net sales of ~$327 million and a GAAP net loss from continuing operations of $26.2 million Achieved Q1 Adjusted EBITDA of $23.8 million with an improved EBITDA margin of 7.3% Delivered continued robust Spunlace performance with ~$5 million improved EBITDA Improved Composite Fibers EBITDA by ~$2 million, consistent with expectations Recorded ~$9 million lower EBITDA in Airlaid Materials primarily due to ongoing European market softness CHARLOTTE, N.C., May 09, 2024 (GLOBE NEWSWIRE) -- Glatfelter Corporation (NYSE:GLT), a leading global supplier of engineered materials, today reported financial results for the first quarter of 2024 and provided an update on progress of its proposed merger with the majority of Berry's Global Health, Hygiene and Specialties segment to include its Global Nonwovens and Films ("HHNF") business. "We continued to execute against our strategy to optimize our portfolio and position the business for long-term profitable growth as we prepare to complete the proposed merger with Berry's HHNF business to create a new, global specialty materials leader," said Thomas Fahnemann, President and CEO of Glatfelter. "The team remains focused on delivering meaningful financial performance while ensuring our business segments are well positioned to become part of a larger enterprise that is expected to deliver substantial shareholder value." Mr. Fahnemann added, "Our progress was most evident in Spunlace which delivered $6.1 million in EBITDA, recording gains in margin and volume following a strong fourth quarter. In Composite Fibers, we continued to improve EBITDA, reaching the highest level for this segment since the third quarter of 2021, along with EBITDA margins averaging 10% in the last 3 quarters. As we previously shared in 2023, we took pricing actions in our Airlaid Materials segment as we strove to protect margins and improve the price-cost dynamic. However, these actions combined with ongoing European market challenges, continued to put downward pressure on volumes, which led to weaker than anticipated financial performance for the segment." Mr. Fahnemann concluded, "While overall results for the quarter were mixed, I am encouraged by how far we have come in the past twelve months to enhance the performance of our business, further offsetting many of the prevailing macroeconomic headwinds. The team continues to make excellent progress with preparing for the closing of the proposed merger with Berry's HHNF business, with the goal of value creation and long-term growth for our shareholders. The work that is underway will provide a strong foundation from which to build scale, capitalize on an expanded product portfolio and complementary technology, and ultimately lower Glatfelter's current leverage. I look forward to providing additional updates on our progress as integration preparations continue and additional regulatory milestones are met." Update on Merger with Berry's HHNF Business As previously announced on February 7, 2024, we entered into certain definitive agreements with Berry Global Group, Inc. ("Berry") for Berry to spin-off and merge the HHNF business with Glatfelter to create a global leader in specialty materials. Upon the completion of the transaction, Glatfelter shareholders are expected to own approximately ten percent of the newly combined company. In April, the Company achieved a regulatory milestone with the expiration of the required waiting period under the Hart-Scott-Rodino ("HSR") Antitrust Improvements Act. The transaction is subject to further certain customary closing conditions and regulatory approvals that are currently underway including, but not limited to, approval by Glatfelter shareholders. The merger transaction is expected to close in the second half of 2024.           Three months ended March 31, Dollars in thousands   2024   2023           Net sales   $ 327,256     $ 378,208   Net loss from continuing operations     (26,150 )     (13,182 ) Adjusted loss from continuing operations(1)     (14,939 )     (5,866 ) EPS from continuing operations     (0.58 )     (0.29 ) Adjusted EPS(1)     (0.33 )     (0.13 ) Adjusted EBITDA(1)     23,820       24,785   (1)   Adjusted EBITDA, adjusted loss from continuing operations and adjusted EPS are non-GAAP financial measures. See "Reconciliation of GAAP Financial information to Non-GAAP Financial information" later in this earnings release for further information.       First Quarter Results The following table sets forth a reconciliation of results on a GAAP basis to an adjusted earnings basis, a non-GAAP measure:     Three months ended March 31,     2024   2023 In thousands, except per share   Amount   EPS   Amount   EPS                   Net loss   $ (26,347 )   $ (0.58 )   $ (13,584 )   $ (0.30 ) Exclude: Loss from discontinued operations, net of tax     197       —       402       0.01   Loss from continuing operations     (26,150 )     (0.58 )     (13,182 )     (0.29 ) Adjustments(pre-tax):                 Strategic initiatives(1)     10,910           730       Turnaround strategy costs(2)     57           4,483       Debt refinancing(3)     —           1,883       CEO transition costs(4)     —           633       Timberland sales and related costs     —           (617 )     Total adjustments(pre-tax)     10,967           7,112       Income taxes(5)     (11 )         (3 )     Other tax adjustments(6)     255           207       Total after-tax adjustments     11,211       0.25       7,316       0.16   Adjusted loss from continuing operations   $ (14,939 )   $ (0.33 )   $ (5,866 )   $ (0.13 ) (1)   For 2024, reflects primarily professional services fees related to the Berry HHNF merger (including transaction advisory, legal and other consultant costs) of $10.5 million and personnel retention, to offset the risk of potential employee departures due to the pending transaction, and other costs of $0.4 million. For 2023, reflects consulting and legal fees of $0.5 million, employee separation costs of $0.1 million, and other costs of $0.1 million. (2)   For 2024, primarily reflects employee separation costs. For 2023, reflects employee separation costs of $3.3 million and $1.2 million in professional fees. (3)   In 2023, reflects $1.8 million write-off of deferred debt issuance costs in connection with the Company's debt refinancing and $0.1 million in early repayment penalties and write-off of unamortized financing fees on the IKB Deutsche Industriebank AG, Düsseldorf ("IKB") loans. (4)   In 2023, reflects pension settlement charge related to former CEO separation. (5)   Tax effect on adjustments calculated based on the incremental effective tax rate of the jurisdiction in which each adjustment originated. For items originating in the U.S., no tax effect is recognized due to the previously established valuation allowance on the net deferred tax assets. (6)   Tax effect of applying certain provisions of the CARES Act of 2020.       A description of each of the adjustments presented above is included later in this release. Airlaid Materials     Three months ended March 31,   Dollars in thousands   2024   2023   Change                     Tons shipped (metric)     38,341       39,827       (1,486 )   (3.7 )% Net sales   $ 131,529     $ 159,441     $ (27,912 )   (17.5 )% Operating income     4,958       13,914       (8,956 )   (64.4 )% EBITDA     12,622       21,600       (8,978 )   (41.6 )% EBITDA %     9.6 %     13.5 %                                       Airlaid Materials' first quarter net sales decreased $27.9 million in the year-over-year comparison mainly driven by lower selling prices from cost pass-through arrangements and lower energy surcharges in Europe as both raw materials and energy input costs declined compared to last year. Shipments were 3.7% lower driven by declines in the hygiene categories mainly due to pricing actions taken in 2023 to retain margins. Currency translation was favorable by $0.7 million. Airlaid Materials' first quarter EBITDA of $12.6 million was $9.0 million lower when compared to the first quarter of 2023. Selling price decreases for pass-through contracts, lower energy surcharges, and select spot price reductions were a combined $20.3 million, and were mostly offset by lower raw material and energy costs of $17.9 million. Lower shipments primarily in the hygiene categories combined with unfavorable mix from lower color tabletop shipments negatively impacted results by approximately $1.8 million. Operations were unfavorable by $3.8 million mainly due to lower production of approximately 2,800 MT to manage inventory levels, and higher wage inflation. Currency and related hedging negatively impacted earnings by $1.0 million. Composite Fibers     Three months ended March 31, Dollars in thousands   2024   2023   Change                   Tons shipped (metric)     25,002       24,818       184     0.7 % Net sales   $ 116,150     $ 132,591     $ (16,441 )   (12.4 )% Operating income     8,259       6,127       2,132     34.8 % EBITDA     12,023       10,092       1,931     19.1 % EBITDA %     10.4 %     7.6 %                                   Composite Fibers' net sales were $16.4 million lower in the first quarter of 2024, compared to the year-ago quarter due to lower selling prices of $11.1 million. Even though shipments were higher 0.7%, it was largely driven by the composite laminates category that have lower average selling prices compared to other inclined wire products and thereby lowering the revenue for the quarter. Currency translation was favorable by $0.9 million. Composite Fibers had EBITDA for the first quarter of $12.0 million compared with $10.1 million EBITDA in the first quarter of 2023. Price-cost gap continued to trend positive this quarter as the decrease in input prices paid for raw materials, energy, freight, and packaging were more favorable than selling price declines, resulting in earnings improvement of $2.5 million. Shipments were higher primarily in the composite laminate and metallized categories and overall improved income by $0.4 million. Operations were unfavorable by $0.8 million, mainly driven by lower production. The impact of currency and related hedging negatively impacted earnings by $0.2 million. Spunlace     Three months ended March 31, Dollars in thousands   2024   2023   Change                   Tons shipped(metric)     16,091       16,420       (329 )   (2.0 )% Net sales   $ 80,130