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PVC Container Reports Third Fiscal Quarter Results and Exit of PVC Compound Business

PVC Container Corporation reported its 3rd quarter results and announced that it has signed an asset purchase agreement to sell certain assets that are a component of the Company's Compound segment. William J. Bergen, President and Chief Executive Officer of PVC Container Corporation, said, "To further position our core bottle business for future growth and profitability we have signed a definitive agreement with PolyOne Corporation to purchase certain assets of our Novatec PVC compounding business. In connection with this agreement PolyOne will enter into a long-term agreement to supply PVC bottle compound to our core bottle business. The agreement also provides for a rapid and seamless transition of the product and service needs of the external customers of Novatec to PolyOne." Because of this transaction the Novatec facility will cease production sometime between September 1 and December 31, 2005. Mr. Bergen commented, "We regret the impact this decision will have on the employees of our Novatec business. Their commitment to quality and customer service has been excellent."

The transaction is expected to close in the fourth fiscal quarter subject to the completion by PolyOne of due diligence and the satisfaction or waiver of customary closing conditions. All of the fixed assets of Compound segment have been classified as assets held for sale. Management believes it is unlikely there will be significant changes to the agreement or that the agreement will be withdrawn. As a result, the Compound segment has been reflected in the Company's financial statements as a discontinued operation for all periods presented. Management believes that the asset sale will better position the Company to increase strategic value for our stakeholders. Performance in the quarter ended March 31, 2005, was adversely impacted by asset impairment charges. In addition, rising resin and energy costs continued to negatively impact the business. Sales were down slightly versus the third quarter of the previous fiscal year.

The Company had a net loss of approximately $223,000, or $.03 per diluted common share, for the third fiscal quarter ended March 31, 2005, compared to a profit of approximately $313,000, or $.04 per diluted common share, for the same period a year ago. Operating income decreased by approximately $129,000 for the third fiscal quarter of 2005 compared to the same period in fiscal 2004. Net sales were approximately $22,415,000 for the quarter ended March 31, 2005, compared to $22,656,000 for the quarter ended March 31, 2004. For the nine months ended March 31, 2005, the Company reported a net loss of $6,061,000, or $.86 per diluted common share, compared to a net loss of $135,000, or $.02 per diluted common share, for the same period a year ago. Net sales increased by 7.1% to $61,977,000, for the nine-months ended March 31, 2005, compared to $57,853,000 for the nine months ended March 31,

	PVC Container Reports Third Fiscal Quarter Results and Exit of PVC Compound Business PVC Container Corporation reported its 3rd quarter results and announced that it has signed an asset purchase agreement to sell certain assets that are a component of the Company's Compound segment. William J. Bergen, President and Chief Executive Officer of PVC Container Corporation, said, "To further position our core bottle business for future growth and profitability we have signed a definitive agreement with PolyOne Corporation to purchase certain assets of our Novatec PVC compounding business. In connection with this agreement PolyOne will enter into a long-term agreement to supply PVC bottle compound to our core bottle business. The agreement also provides for a rapid and seamless transition of the product and service needs of the external customers of Novatec to PolyOne." Because of this transaction the Novatec facility will cease production sometime between September 1 and December 31, 2005. Mr. Bergen commented, "We regret the impact this decision will have on the employees of our Novatec business. Their commitment to quality and customer service has been excellent." The transaction is expected to close in the fourth fiscal quarter subject to the completion by PolyOne of due diligence and the satisfaction or waiver of customary closing conditions. All of the fixed assets of Compound segment have been classified as assets held for sale. Management believes it is unlikely there will be significant changes to the agreement or that the agreement will be withdrawn. As a result, the Compound segment has been reflected in the Company's financial statements as a discontinued operation for all periods presented. Management believes that the asset sale will better position the Company to increase strategic value for our stakeholders. Performance in the quarter ended March 31, 2005, was adversely impacted by asset impairment charges. In addition, rising resin and energy costs continued to negatively impact the business. Sales were down slightly versus the third quarter of the previous fiscal year. The Company had a net loss of approximately $223,000, or $.03 per diluted common share, for the third fiscal quarter ended March 31, 2005, compared to a profit of approximately $313,000, or $.04 per diluted common share, for the same period a year ago. Operating income decreased by approximately $129,000 for the third fiscal quarter of 2005 compared to the same period in fiscal 2004. Net sales were approximately $22,415,000 for the quarter ended March 31, 2005, compared to $22,656,000 for the quarter ended March 31, 2004. For the nine months ended March 31, 2005, the Company reported a net loss of $6,061,000, or $.86 per diluted common share, compared to a net loss of $135,000, or $.02 per diluted common share, for the same period a year ago. Net sales increased by 7.1% to $61,977,000, for the nine-months ended March 31, 2005, compared to $57,853,000 for the nine months ended March 31,
	Formosa IPO would include J-M, Nan Ya Formosa Plastics Group is planning a U.S.-based initial public offering that would combine PVC/polyolefins maker Formosa Plastics Corp. USA with pipe producer J-M Manufacturing Co. Inc. and PET resin maker Nan Ya Plastics Corp. The IPO would help Formosa, a conglomerate based in Taipei, Taiwan, raise funding for a major growth project in China, according to a May 24 Bloomberg News story. The first public mention of the IPO came when Formosa Plastics President C.T. Lee spoke with reporters May 24 after the firm’s annual shareholders meeting in Taipei. Lee told reporters at the time that there are “ a lot of opportunities” in U.S. capital markets that Formosa hasn’t been using, and that the U.S. units will be combined “because the U.S. market likes large-scale companies.” Rob Thibault, Formosa’s U.S.-based spokesman, said the IPO could take place sometime in 2006 and will combine four legal entities: Formosa Plastics Corp. USA, Formosa Plastics Corp. America, Nan Ya Plastics Corp. USA and Nan Ya Plastics Corp. America. Livingston, N.J.-based Formosa Plastics Corp. USA is one of North America’s largest PVC makers and is a sizable producer of polyethylene and polypropylene. J-M ranked was in a recent Plastics News ranking of North American pipe, profile and tubing makers, with annual sales estimated at $625 million. Nan Ya has a smaller presence in PET, but still holds about 5 percent of North American capacity. Formosa Plastics Corp. USA employs more than 2,300 and posted sales of more than $2.5 billion last year. No employee or sales totals were available for Nan Ya. A Formosa IPO would be the fourth plastics-related IPO in the past year, joining offerings from Westlake Chemical Corp., Celanese AG and Huntsman Corp. Results from those efforts have been mixed. Of the three, Westlake has been the most successful. Its stock debuted at around $15 per share in August and passed $36 in March before coming down to a recent $25 — a 67 percent bump-up in nine months as a public company. Industry sources said there are some intriguing parallels between Westlake and Formosa, since both make PVC and polyethylene and operate a pipe unit. In Westlake’s case, the pipe business is North American Pipe Corp. of Houston, which was seventh in the Plastics News ranking, with estimated sales of $345 million. Both firms have Taiwanese ownership, with Westlake controlled by Chao Group. While it appears Westlake timed the market right, Celanese and Huntsman have not been as lucky. Celanese opened at $16 in late January, passed $18 in March, but since has dropped back to its original price. Huntsman debuted around $25 in early February and passed $28 later that month, but has slipped to a recent $19. For plastics and chemical firms, finding success in the current IPO market “isn’t a sure thing,” said Jeff Dancer, president of Allan F. Dow Group, a private equity firm in Houston. “A lot of people think that because there’s so much private capital that’s plentiful and cheap right now, that it’s a good time to put themselves up [for an IPO] and see what people will pay,” said Dancer, who spent 25 years in the PE business with Phillips Petroleum Corp. “But in our view, polyolefin prices have peaked, so it may be time to cash out of these markets.” PVC Industry Sustainability Initiative Gathers Momentum Vinyl 2010 launched its fifth and most detailed Progress Report to date. The report focuses on no fewer than 16 major waste management schemes and other challenging projects throughout Europe. This reflects the deep commitment of the PVC industry and the progress made by Vinyl 2010. Vinyl 2010, putting into action the Voluntary Commitment of the European PVC industry, is a 10-year plan to achieve sustainability throughout the PVC lifecycle. It delivers against clear targets, especially on the use of lead-based stabilisers and on post-consumer recycling. Progress is reviewed by independent auditors and a Monitoring Committee including representatives of the European Commission and of the European Parliament. Some highlights in the report are: * Achievement one year ahead of schedule of the target to reduce consumption of lead stabilisers by 15%; * Near completion of a new 50,000 tonnes-a-year feedstock recycling plant in Stigsnaes, Denmark; * Completion of a feasibility study concluding that PVC waste from buildings can be employed to produce light concrete for use in certain building applications. While progress was steady, Vinyl 2010 also saw a paradoxical challenge on PVC waste management. "Recycling technology is now in place thanks to research, careful planning and heavy investment," said Jean-Pierre De Grève, Secretary General of Vinyl 2010. "However, the challenge is waste availability because of collection cost, increasing re-use of old products such as windowframes, and demand for waste from Asia", he added. To encourage a steady supply of PVC waste for recycling, Vinyl 2010 launched two new pan-European collection projects in 2004: * Roofcollect, a collection and recycling initiative for end-of-life roofing membranes; * Recovinyl, a scheme to provide financial incentives to support the collection of end-of-life PVC products such as pipes, window profiles and shutters. Vinyl 2010 is the Brussels-based international non-profit association that brings together the entire European PVC industry - producers of polyvinyl chloride (PVC) resins, stabilisers, plasticisers and plastic converters - to implement the Voluntary Commitment they signed in March 2000. The Voluntary Commitment is a 10-year programme to meet the challenges of sustainable development and continuous environmental improvement throughout the European PVC sector.
	Lantai to build PVC facility in Mongolia Lantai Group plans to build facilities to produce 400,000 metric tons per year of PVC in Wusitai Development Zone, Inner Mongolia, China. A source close to the project says the $688.7 million project will also include the building of a 250,000 metric-ton-per-year chloralkali plant, a 600,000 metric-ton-per-year calcium carbide plant, and two 150 megawatt power plants. According to the source, experts in Beijing have assessed the project's feasibility study and recommended that the company pursue the PVC project in two equal phases, the company is securing land and environmental approvals for the project. Lantai plans to start work on the project's first phas at the end of June, with start-up of the proposed units set for 2006-2007. However, the assessment has yet to be completed and it is unclear which of the proposed units will be built first and when they will start up. A source from Lantai confirms the project, noting that the company chose Wusitai for its first PVC project because the region has access to resources such as coal, salt and electricity.