Adjusted EBITDA increased 32%, or $2.2 million, to $9.2 million, a new quarterly record, in the 3Q 2014, compared to $7 million in 2013. EBITDA increased 22%, or $1.5 million, to $8.5 million, a new quarterly record, in the 3Q 2014, compared to $6.9 million in 2013.
Gross profit for the 3Q 2014 was $8.8 million, an increase of $1.6 million, or 23%, when compared with a gross profit of $7.1 million in the prior year quarter.
Jeff Schoen, President and CEO, stated, "Results in the 3Q and 2014 year-to-date improved significantly over the respective periods in 2013 as a result of new business, the improvement in western sales due to the Fabrica partnership we entered into in June, and a recovery of existing business from the 2Q 2014. As stated last quarter, we expect the second half of 2014 to be a record setting one, which the 3Q results support. Furthermore, our partnership with Fabrica to supply our west coast sales is exceeding our expectations and has immediately added value to shareholders in the 3Q."
"Strategically, the previously announced expansion plan is progressing as planned and is expected to increase our capacity for future growth, improve our manufacturing flexibility and lower our cost structure. A new paper machine is on track to be at full production rates by the beginning of the 2Q 2015 and is expected to deliver approximately $6 million of additional EBITDA."
Net sales in the nine-month period ended September 30, 2014 were $101.4 million, which increased $15.8 million, or 18%, compared to $85.6 million in the same period of 2013.
Gross profit for the nine-month period of 2014 was $20.3 million, a decrease of $371,000, or 2%, when compared with a gross profit of $20.7 million in the prior year period. Gross profit as a percent of net sales was 20.0% in the nine-month period of 2014 compared to 24.1% for the same period in 2013.
Orchids Paper Products Company is an integrated manufacturer of tissue paper products serving the at home private label consumer market.