The Paper Products Ltd

H1 Net sales up by 21.8% and

Net Profit up by 14.2%

Mumbai, July 25, 2008: The Paper Products Limited (HUHTAMAKI-PPL), India's leading flexible packaging company, today announced its Unaudited Financial Results for the second quarter & the first half year ended June 30, 2008. The company achieved sales of Rs.330.64 crores during the half year, representing a growth of 21.8% over sales of Rs.271.55 crores in H1-2007. The profit before tax is Rs.17.50 crores compared to Rs.14.90 crores in H1-2007 showing growth of 17.4%. The basic and diluted earnings per share is Rs.2.14 as compared to Rs.1.87 in H1-2007.

In comparison between quarters, the company has achieved sales of Rs.172.40 crores in Q2-2008 representing a growth of 22%, over sales of Rs.141.29 crores in Q2-2007. The profit before tax is Rs.5.72 crores in Q2-2008 as compared to Rs.5.55 crores in Q2-2007. The basic & diluted earnings per share is at Rs.0.64 in Q2-2008 as compared to Rs.0.64 in Q2-2007.

A book loss of Rs.5.22 crores & Rs.4.06 crores has been taken in above H1-2008 & Q2-2008 results respectively, for marked to market valuation of forex contracts which have been entered into to hedge the forecast transactions, consequent to the ICAI announcement of 29th March 2008 on Accounting for Derivatives.

A charge of Rs.1.30 crores has been taken in H1-2008 & Q2-2008 results towards settlement compensation paid to employees of the Nagpur Unit which ceased manufacturing operations with effect from 27th April 2008.

An interest income of Rs.1.45 crores & Rs.0.28 crores has been received during the H1-2008 & Q2-2008 respectively on Income Tax Refunds.

A profit of Rs.1.37 crores has been accounted in H1-2008 & Q2-2008 results realized on the sale of right to receive transferable development rights. This right arises from the transfer of a portion of the Thane Plant vacant land compulsorily acquired by the Thane Municipal Corporation.

The new Rudrapur plant is operating at capacity levels.

Reconstruction of the Thane Plant is on going & relocation of operations in a phased manner has commenced as scheduled from June 2008.

Unprecedented raw material price increases on all inputs have lead to a severe margin pressure. The company is implementing strategies to counter the resulting margin deterioration with a focused approach.

 

About The Paper Products Limited (HUHTAMAKI-PPL):

PPL is India's leading manufacturer of primary consumer packaging with 2007 gross sales of Rs.640 crores, and net capital employed of about Rs.310 crores.

Since 1999, PPL is a joint venture with the global packaging major, Huhtamaki Oyj, Finland who hold about 59% of the equity capital. Huhtamaki is one of the world's top ten consumer packaging multinationals.

PPL is a pioneer and the technology and market leader in flexible packaging in India with manufacturing facilities at Thane, Silvassa, Hyderabad and Rudrapur. It meets the packaging needs of almost the entire range of FMCG segments including personal products, personal wash, laundry, foods, sauces, beverages, bakery products, spices, chocolates and confectionery, dairy and also for seeds, specialized chemicals, electronics and many other specific specialized uses including anti-spurious packaging.

The Package Protection and Decoration products range includes latest leading edge technologies - shrink sleeves, wrap-arounds, heat transfers, pressure sensitives and metallised paper labels.

Manufacturing of specialized cartons and cartoning systems, manufacture of poly films, specialized barrier metallising and high-end application extrusion coating are also part of PPL's product offerings.

The company's packaging machines division offers complete packaging solutions to customers.

PPL mainly caters to the premium segment of packaging and its clients include Britannia, Cadbury, Castrol, Coca Cola, Dabur, Emami, Eveready, GSK, Godrej, Hindustan Latex, Hindustan Unilever, HPCL, ITC, Marico, MICO, Nestle, Pepsi, Perfetti, P&G, Tata Tea, TTK-LIG, Wipro and may more.

More at our website : www.pplpack.com

Mr. Ravi Chidambaram Controller - Finance & Joint CFO The Paper Products Limited Board: +91 - 22 - 2534 3691- Ext. 453 Mobile +91 - 98216 04825