10-Q 1 y86145e10vq.txt TEKNI-PLEX, INC. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 28, 2003 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from_______________to_____________________ Commission file number 333-28157 TEKNI-PLEX, INC. -------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 22-3286312 ---------------------------------- ------------------------------------- (State or other jurisdiction (IRS Employer Identification Number) of incorporation or organization) 260 N. Denton Tap Road, Suite 150 (972) 304-5077 ---------------------------------- --------------------------------- Coppell, TX 75019 (Registrant's telephone number) --------------------------------- (Address of principal executive office) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] TEKNI-PLEX, INC.

Page # PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS Consolidated Balance Sheets as of March 28, 2003 and June 28, 2002 3 Consolidated Statements of Operations for the nine months and three months ended March 28, 2003 and March 29, 2002 4 Consolidated Statements of Other Comprehensive Income (loss) for the nine months and three months ended March 28, 2003 and March 29, 2002 4 Consolidated Statements of Cash Flows for the nine months ended March 28, 2003 and March 29, 2002 5 Notes to Consolidated Financial Statements 6-18 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 19-21 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 21 ITEM 4. CONTROLS AND PROCEDURES 22 PART II. OTHER INFORMATION Item 1. Legal proceedings 23 Item 2. Changes in securities 23 Item 3. Defaults upon senior securities 23 Item 4. Submission of matters to a vote of securities holders 23 Item 5. Other information 23 Item 6. Exhibits and reports on Form 8-K 23 Item 7. Certifications 24-26

TEKNI-PLEX, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)

MARCH 28, 2003 June 28, 2002 (UNAUDITED) ----------- -------------------- ASSETS CURRENT: Cash $ 16,842 $ 28,199 Accounts receivable, net of allowance for doubtful accounts of $2,101 and $1,671 142,714 147,198 Inventories 165,823 117,632 Deferred income taxes 7,472 7,472 Prepaid and other current assets 7,853 5,583 --------- --------- TOTAL CURRENT ASSETS 340,704 306,084 PROPERTY, PLANT AND EQUIPMENT, NET 177,829 158,118 INTANGIBLE ASSETS, NET OF ACCUMULATED AMORTIZATION OF $79,085 AND $78,399 215,383 204,252 DEFERRED CHARGES, NET OF ACCUMULATED AMORTIZATION OF $6,899 AND $5,030 12,474 14,343 DEFERRED INCOME TAXES 18,879 16,278 OTHER ASSETS 967 1,078 --------- --------- $ 766,236 $ 700,153 ========= ========= LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES: Current portion of long-term debt $ 13,290 $ 13,407 Accounts payable - trade 39,386 32,643 Accrued payroll and benefits 9,103 8,965 Accrued interest 17,026 4,789 Accrued liabilities - other 25,424 28,846 Income taxes payable 4,539 515 --------- --------- TOTAL CURRENT LIABILITIES 108,768 89,165 LONG-TERM DEBT 715,806 679,414 OTHER LIABILITIES 25,956 22,685 --------- --------- TOTAL LIABILITIES 850,530 791,264 --------- --------- STOCKHOLDERS' DEFICIT: Common stock -- -- Additional paid-in capital 170,568 170,176 Accumulated other comprehensive loss (4,745) (6,805) Accumulated deficit (29,595) (33,959) Treasury stock (220,522) (220,523) --------- --------- TOTAL STOCKHOLDERS' DEFICIT (84,294) (91,111) --------- --------- $ 766,236 $ 700,153 ========= =========

See accompanying notes to consolidated financial statements. 3 TEKNI-PLEX, INC. AND SUBSIDIARIES (Unaudited -- in thousands) CONSOLIDATED STATEMENTS OF OPERATIONS

Three months ended Nine months ended MARCH 28, March 29, MARCH 28, March 29, 2003 2002 2003 2002 -------- --------- --------- -------- NET SALES $166,091 $ 153,393 $ 425,258 $382,297 COST OF SALES 121,966 111,385 319,871 285,591 -------- --------- --------- -------- GROSS PROFIT 44,125 42,008 105,387 96,706 OPERATING EXPENSES: Selling, general and administrative 14,562 18,529 43,046 50,314 -------- --------- --------- -------- OPERATING PROFIT 29,563 23,479 62,341 46,392 OTHER EXPENSES: Interest expense 18,722 19,014 53,971 53,389 Unrealized (gain) loss on derivative contracts (833) 1,085 1,303 3,675 Other (income) expenses (359) (105) 23 229 -------- --------- --------- -------- INCOME (LOSS) BEFORE INCOME TAXES 12,033 3,485 7,044 (10,901) PROVISION (BENEFIT) FOR INCOME TAXES 4,430 1,180 2,680 (3,820) -------- --------- --------- -------- NET INCOME (LOSS) $ 7,603 $ 2,305 $ 4,364 $ (7,081) ======== ========= ========= ======== CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (LOSS) NET INCOME (LOSS) $ 7,603 $ 2,305 $ 4,364 $ (7,081) COMPREHENSIVE INCOME (LOSS), NET OF TAXES Foreign currency translation adjustment 1,240 (3,985) 2,060 (4,277) -------- --------- --------- -------- COMPREHENSIVE INCOME (LOSS) $ 8,843 $ (1,680) $ 6,424 $(11,358) ======== ========= ========= ========

See accompanying notes to consolidated financial statements. 4 TEKNI-PLEX, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited -- in thousands)

Nine months ended MARCH 28, 2003 March 29, 2002 -------------- -------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 4,364 $ (7,081) Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 20,144 29,011 Unrealized loss on derivative contracts 1,303 3,675 Deferred income taxes (296) (3,465) Changes in operating assets and liabilities: Accounts receivable 8,139 (9,624) Inventories (45,202) (21,769) Prepaid expenses and other current assets (1,857) (2,703) Income taxes 4,024 (2,202) Accounts payable (833) (5,003) Accrued interest 12,248 13,763 Accrued expenses and other liabilities (7,661) (10,033) -------- --------- NET CASH USED IN OPERATING ACTIVITIES (5,627) (15,431) -------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (24,587) (12,317) Acquisitions of assets including acquisition costs (16,806) (65,757) Additions to intangibles (807) 797 Deposits and other assets 119 846 -------- --------- NET CASH USED IN INVESTING ACTIVITIES (42,081) (76,431) -------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings of long-term debt 36,098 6,012 Payment for treasury stock -- (60) Receipt of additional paid-in capital 392 50,000 Debt financing costs -- (120) -------- --------- NET CASH PROVIDED BY FINANCING ACTIVITIES 36,490 55,832 -------- --------- EFFECT OF EXCHANGE RATE CHANGES ON CASH (139) 5 -------- --------- NET DECREASE IN CASH (11,357) (36,025) CASH, BEGINNING OF PERIOD 28,199 44,645 -------- --------- CASH, END OF PERIOD $ 16,842 $ 8,620 ======== ========= SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for: Interest $ 41,933 $ 38,290 Income taxes 2,716 1,912

See accompanying notes to consolidated financial statements. 5 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ( in thousands) NOTE 1 - GENERAL Tekni-Plex is a global, diversified manufacturer of packaging, packaging products and materials as well as tubing products. Tekni-Plex primarily serves the food, healthcare and consumer markets. Tekni-Plex has built leadership positions in its core markets, and has focused on vertically integrated production of highly specialized products. Tekni-Plex has operations in the United States, Europe and Canada. Tekni-Plex's operations are aligned under two business segments: Packaging and Tubing Products. Products that do not fit in either of these two segments, including recycled PET, vinyl compounds and specialty resins have been reflected as Other. The consolidated financial statements include the accounts of Tekni-Plex, Inc. and its Subsidiaries. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. For further information please refer to the audited financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended June 28, 2002. The results of operations and cash flows for the nine months ended March 28, 2003 are not necessarily indicative of the results to be expected for the fiscal year ending June 27, 2003 or any other period. NOTE 2 - NEW ACCOUNTING PRONOUNCEMENTS a) In June 2001, the Financial Accounting Standards Board finalized FASB Statements No. 141, Business Combinations (SFAS 141) and No. 142, Goodwill and Other Intangible Assets (SFAS 142). SFAS 141, requires the use of the purchase method of accounting and prohibits the use of the pooling-of-interests method of accounting for business combinations initiated after June 30, 2001. SFAS 141 requires that the Company recognize acquired intangible assets apart from goodwill if the acquired intangible assets meet certain criteria. SFAS 141 applies to all business combinations initiated after June 30, 2001 and for purchase business combinations completed on or after July 1, 2001. It also requires, upon adoption of SFAS 142, that the company reclassify the carrying amounts of intangible assets and goodwill based on the criteria in SFAS 141. SFAS 142 requires, among other things, that the companies no longer amortize goodwill, but instead test goodwill for impairment at least annually. In addition, SFAS 142 requires that the Company identify reporting units for the purposes of assessing potential future impairments of goodwill, reassess the useful lives of other existing recognized intangible assets, and cease amortization of intangible assets with an indefinite useful life. An intangible asset with an indefinite useful life should be tested for impairment in accordance with the guidance in SFAS 142. SFAS 142 is required to be applied in fiscal years beginning after December 15, 2001 to all goodwill and other intangible assets recognized at that date, regardless of when those assets were initially recognized. SFAS 142 requires the Company to complete a transitional goodwill impairment test six months from the date of adoption. The Company is also required to reassess the useful lives of other intangible assets within the first interim quarter after adoption of SFAS 142. The Company has completed its transitional analysis of goodwill and has determined no adjustments are necessary. 6 If SFAS 142 had been adopted June 30, 2001, the Company's net loss for the nine months ended March 29, 2002 would have reduced because of lower amounts of amortization as follows:

Three Months Ended Nine Months Ended Net income (loss), as reported $ 2,305 $ (7,081) Add amortization, net of tax 3,462 10,377 -------- --------- Adjusted net income $ 5,767 $ 3,296 ======== =========

b) In December 2002, The FASB issued SFAS No. 148, "Accounting for Stock-Based Compensation -- Transition and Disclosure -- an amendment of FASB Statement No. 123". SFAS No. 148 amends SFAS No. 123, "Accounting for Stock-Based Compensation," to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 as it relates to accounting for stock-based employee compensation and the effect of the method used on reported results. The Company does not plan to adopt the fair value based method prescribed by FASB 123. Under the accounting provisions of FASB 123, the Company's net income (loss) would have been adjusted to the pro forma amounts indicated below, using the following assumptions: expected lives of 8 years, no dividend yield, volatility at 0%, and risk free interest rate of 4.0% for 2001 (the last year of grants). Three months ended Nine months ended March 28, March 29, March 28, March 29, 2003 2002 2003 2003 -------------------- -------------------- Net income (loss), As reported $7,603 $2,305 $4,364 $(7,081) Adjustments for fair value of stock options, net of tax (32) (36) (96) (109) -------------------- -------------------- Pro forma $7,571 $2,269 $4,268 $(7,190) -------------------- -------------------- NOTE 3 - INVENTORIES Inventories as of March 28, 2003 and June 28, 2002 are summarized as follows:

MARCH 28, 2003 June 28, 2002 -------------- ------------- Raw materials $ 51,268 $ 37,727 Work-in-process 9,970 8,621 Finished goods 104,585 71,284 --------- --------- $ 165,823 $ 117,632 --------- ---------

7 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 4 - LONG-TERM DEBT Long-term debt consists of the following:

MARCH 28, 2003 June 28, 2002 -------------- ------------- Senior Subordinated Notes issued June 21, 2000 at 12-3/4% due June 15, 2010. (Less unamortized $ 272,269 $ 271,985 discount of $2,731 and $3,015) Senior Subordinated Notes issued May 2002 at 12-3/4% due June 15, 2010 (plus unamortized premium 40,531 40,588 at $531 and $588) Senior Debt: Revolving line of credit, expiring June, 2006. At March 28, 2003, the interest rates ranged from 4.44 % to 6.25%. 88,000 46,000 Term notes due June, 2006 and June, 2008, with interest rates at March 28, 2003 of 4.38% and 322,900 329,120 4.88%. Other, primarily international term loans, with interest rates ranging from 4.44% to 5.44% and 5,396 5,128 maturities ranging from 2003 to 2010 --------- ---------- 729,096 692,821 Less: Current maturities 13,290 13,407 --------- ---------- $ 715,806 $ 679,414 --------- ----------

8 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 5 - SEGMENT INFORMATION Tekni-Plex has organized its business into two industry segments: Packaging and Tubing Products. The Packaging segment principally produces foam egg cartons, pharmaceutical blister films, poultry and meat processor trays, closure liners, aerosol and pump packaging components and foam plates. The Tubing Products segment principally produces garden and irrigating hose, medical tubing and pool and vacuum hose. Products that do not fit in either of these segments, including recycled PET, vinyl compounds and specialty resins, have been reflected in Other. Tekni-Plex's segments have operations in the United States, Europe and Canada. Financial information concerning the Company's business segments and the geographic areas in which they operate are as follows:

Tubing Packaging Products Other TOTAL -------- -------- ------- -------- Three months ended March 28,2003 Revenues from external Customers $ 69,005 $ 69,355 $27,731 $166,091 Interest expense 5,965 8,779 3,978 18,722 Depreciation and Amortization 3,054 1,674 1,309 6,037 Operating profit (loss) 17,303 17,127 (289) 34,141 Expenditures for segment Assets 6,554 2,437 1,761 10,752 -------- -------- ------- -------- Three months ended March 29,2002 Revenues from external Customers $ 59,143 $ 67,581 $26,669 $153,393 Interest expense 4,002 12,697 2,315 19,014 Depreciation and Amortization 5,444 3,025 1,226 9,695 Operating profit (loss) 12,317 14,204 2,326 28,847 Expenditures for segment Assets 2,146 142 632 2,920 -------- -------- ------- --------

9 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands)

Tubing Packaging Products Other TOTAL -------- -------- ------- -------- Nine months ended March 28, 2003 Revenues from external Customers $199,253 $145,815 $80,190 $425,258 Interest expense 17,185 25,317 11,469 53,971 Depreciation and Amortization 10,493 4,966 3,917 19,376 Operating profit (loss) 44,829 30,034 849 75,712 Expenditures for segment Assets 10,519 9,082 4,371 23,972 -------- -------- ------- -------- Nine months ended March 29, 2002 Revenues from external Customers $174,744 $129,325 $78,228 $382,297 Interest expense 16,988 25,037 11,364 53,389 Depreciation and Amortization 15,254 8,146 4,837 28,237 Operating profit (loss) 32,467 22,587 4,282 59,336 Expenditures for segment Assets 6,435 3,224 2,112 11,771 -------- -------- ------- --------

Three months ended Nine months ended MARCH 28, March 29, MARCH 28, March 29, 2003 2002 2003 2002 --------- -------- -------- --------- PROFIT OR LOSS Total operating profit for reportable segments before income taxes $ 34,141 $ 28,847 $ 75,712 $ 59,336 Corporate and eliminations (4,578) (5,368) (13,371) (12,944) --------- -------- -------- --------- $ 29,563 $ 23,479 $ 62,341 $ 46,392 ========= ======== ======== ========= DEPRECIATION AND AMORTIZATION Segment totals $ 6,037 $ 9,695 $ 19,376 $ 28,237 Corporate 256 262 768 774 --------- -------- -------- --------- Consolidated total $ 6,293 $ 9,957 $ 20,144 $ 29,011 ========= ======== ======== ========= EXPENDITURES FOR SEGMENT ASSETS Total reportable-segment expenditures $ 10,752 $ 2,920 $ 23,972 $ 11,771 Other unallocated expenditures 226 255 615 546 --------- -------- -------- --------- Consolidated total $ 10,978 $ 3,175 $ 24,587 $ 12,317 ========= ======== ======== =========

10 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINACIAL STATEMENTS (in thousands) SEGMENT ASSETS

Packaging Tubing Products Other TOTAL --------- --------------- ------ ----- March 28, 2003 $ 265,367 $ 348,441 $ 130,546 $ 744,354 ---------- ------------ --------- --------- June 28, 2002 $ 222,798 $ 334,710 $ 130,050 $ 687,558 ---------- ------------ --------- ---------

MARCH 28, 2003 June 28, 2002 -------------- ------------- TOTAL ASSETS Total assets from reportable segments $ 744,354 $ 687,558 Other unallocated amounts 21,882 12,595 --------- --------- Consolidated total $ 766,236 $ 700,153 ========= =========

GEOGRAPHIC INFORMATION

Three months ended Nine months ended MARCH 28, March 29, MARCH 28, March 29, 2003 2002 2003 2002 --------- --------- --------- --------- REVENUES United States $ 144,000 $ 137,685 $ 372,154 $ 341,366 International 22,091 15,708 53,104 40,931 --------- --------- --------- --------- Total $ 166,091 $ 153,393 $ 425,258 $ 382,297 ========= ========= ========= =========

MARCH 28, 2003 June 28, 2002 --------------- ------------- LONG-LIVED ASSETS United States $ 378,698 $ 352,365 International 46,834 41,704 --------- --------- Total $ 425,532 $ 394,069 ========= =========

11 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 6 - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS Consolidated Statement of Earnings For the three months ended March 28, 2003

Non- TOTAL Issuer Guarantors Guarantors -------- --------- ---------- ---------- Net sales $ 166,091 $ 37,522 $ 106,478 $ 22,091 Cost of sales 121,966 26,400 79,396 16,170 --------- --------- --------- ---------- Gross profit 44,125 11,122 27,082 5,921 Operating expenses: Selling, General and administrative 14,562 7,058 5,600 1,904 --------- --------- --------- ---------- Operating profit 29,563 4,064 21,482 4,017 Interest expense (income) 18,722 18,685 (11) 48 Unrealized gain on derivative contracts (833) (833) -- -- Other expense (income) (359) (554) (398) 593 --------- --------- --------- ---------- Income (loss) before income taxes 12,033 (13,234) 21,891 3,376 Provision (benefit) for income taxes 4,430 (5,812) 8,890 1,352 --------- --------- --------- ---------- Net income (loss) $ 7,603 $ (7,422) $ 13,001 $ 2,024 ========= ========= ========= ==========

For the nine months ended March 28, 2003

Non- TOTAL Issuer Guarantors Guarantors --------- --------- ---------- --------- Net sales $ 425,258 $ 111,882 $ 260,272 $ 53,104 Cost of sales 319,871 78,699 202,163 39,009 --------- --------- ---------- --------- Gross profit 105,387 33,183 58,109 14,095 Operating expenses: Selling, General and administrative 43,046 19,786 18,233 5,027 --------- --------- ---------- --------- Operating profit 62,341 13,397 39,876 9,068 Interest expense (income) 53,971 53,918 (54) 107 Unrealized loss on derivative contracts 1,303 1,303 -- -- Other expense (income) 23 (578) (998) 1,599 --------- --------- ---------- --------- Income (loss) before income taxes 7,044 (41,246) 40,928 7,362 Provision (benefit) for income taxes 2,680 (15,670) 15,550 2,800 --------- --------- ---------- --------- Net income (loss) $ 4,364 $ (25,576) $ 25,378 $ 4,562 ========= ========= ========== =========

12 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 6 - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS Consolidated Statement of Earnings For the three months ended March 29, 2002

Non- TOTAL Issuer Guarantors Guarantors --------- --------- ---------- ---------- Net sales $ 153,393 $ 40,360 $ 97,325 $ 15,708 Cost of sales 111,385 27,869 72,885 10,631 --------- --------- ---------- --------- Gross profit 42,008 12,491 24,440 5,077 Operating expenses: Selling, General and administrative 18,529 10,854 6,123 1,552 --------- --------- ---------- --------- Operating profit 23,479 1,637 18,317 3,525 Interest expense (income) 19,014 19,002 (10) 22 Unrealized gain on derivative contracts 1,085 1,085 -- -- Other expense (income) (105) (222) (366) 483 --------- --------- ---------- --------- Income (loss) before income taxes 3,485 (18,228) 18,693 3,020 Provision (benefit) for income taxes 1,180 (6,450) 6,700 930 --------- --------- ---------- --------- Net income (loss) $ 2,305 $ (11,778) $ 11,993 $ 2,090 ========= ========= ========== =========

For the nine months ended March 29, 2002

Non- TOTAL Issuer Guarantors Guarantors --------- --------- ---------- ---------- Net sales $ 382,297 $ 121,666 $ 219,700 $ 40,931 Cost of sales 285,591 87,956 167,882 29,753 --------- --------- ---------- --------- Gross profit 96,706 33,710 51,818 11,178 Operating expenses: Selling, General and administrative 50,314 29,737 16,000 4,577 --------- --------- ---------- --------- Operating profit 46,392 3,973 35,818 6,601 Interest expense (income) 53,389 53,356 (86) 119 Unrealized loss on derivative contracts 3,675 3,675 -- -- Other expense (income) 229 (712) (630) 1,571 --------- --------- ---------- --------- Income (loss) before income taxes (10,901) (52,346) 36,534 4,911 Provision (benefit) for income taxes (3,820) (18,360) 12,950 1,590 --------- --------- ---------- --------- Net income (loss) $ (7,081) $ (33,986) $ 23,584 $ 3,321 ========= ========= ========== =========

13 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 6 - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS Condensed Consolidated Balance Sheet - at March 28, 2003

Non- TOTAL Eliminations Issuer Guarantors Guarantors --------- ------------ --------- ---------- ---------- Current assets $ 340,704 $ -- $ 45,668 $ 239,002 $ 56,034 Property, plant and equipment, net 177,829 -- 40,813 112,825 24,191 Intangible assets, net 215,383 -- 8,533 194,481 12,369 Investment in subsidiaries -- (528,458) 528,458 -- -- Deferred income taxes 18,879 -- 19,230 1,430 (1,781) Deferred charges, net 12,474 -- 12,358 116 -- Other assets 967 (343,029) 96,754 235,187 12,055 --------- --------- --------- --------- --------- Total assets $ 766,236 $(871,487) $ 751,814 $ 783,041 $ 102,868 ========= ========= ========= ========= ========= Current liabilities $ 108,768 $ -- $ 48,532 $ 42,440 $ 17,796 Long-term debt 715,806 -- 711,260 -- 4,546 Other liabilities 25,956 (343,029) 71,590 256,772 40,623 --------- --------- --------- --------- --------- Total liabilities 850,530 (343,029) 831,382 299,212 62,965 --------- --------- --------- --------- --------- Additional paid-in capital 170,568 (312,420) 170,549 296,783 15,656 Retained earnings, Accumulated (deficit) (29,595) (216,038) (29,595) 190,131 25,907 Accumulated other comprehensive loss (4,745) -- -- (3,085) (1,660) Less: Treasury stock (220,522) -- (220,522) -- -- --------- --------- --------- --------- --------- Total stockholders' deficit (84,294) (528,458) (79,568) 483,829 39,903 --------- --------- --------- --------- --------- Total liabilities and stockholders' deficit $ 766,236 $(871,487) $ 751,814 $ 783,041 $ 102,868 ========= ========= ========= ========= =========

14 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 6 - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS Condensed Consolidated Balance Sheet - at June 28, 2002

Non- Total Eliminations Issuer Guarantors Guarantors --------- ------------ --------- ---------- ---------- Current assets $ 306,084 $ -- $ 44,828 $ 209,798 $ 51,458 Property, plant and equipment, net 158,118 -- 41,704 95,366 21,048 Intangible assets, net 204,252 -- 7,907 184,093 12,252 Investment in subsidiaries -- (498,518) 498,518 -- -- Deferred charges, net 14,343 -- 14,134 -- 209 Deferred taxes 16,278 -- 20,177 -- (3,899) Other income assets 1,078 (321,468) 74,008 236,444 12,094 --------- --------- --------- --------- --------- Total assets $ 700,153 $(819,986) $ 701,276 $ 725,701 $ 93,162 ========= ========= ========= ========= ========= Current liabilities $ 89,165 $ -- $ 29,889 $ 42,563 $ 16,713 Long-term debt 679,414 -- 675,253 -- 4,161 Other liabilities 22,685 (321,468) 80,460 229,752 33,941 --------- --------- --------- --------- --------- Total liabilities 791,264 (321,468) 785,602 272,315 54,815 --------- --------- --------- --------- --------- Additional paid-in capital 170,176 (312,420) 170,156 296,784 15,656 Retained earnings, Accumulated (deficit) (33,959) (186,098) (33,959) 159,960 26,138 Accumulated other comprehensive income (6,805) -- -- (3,358) (3,447) Treasury stock (220,523) -- (220,523) -- -- --------- --------- --------- --------- --------- Total stockholders' deficit (91,111) (498,518) (84,326) 453,386 38,347 --------- --------- --------- --------- --------- Total liabilities and stockholders' deficit $ 700,153 $(819,986) $ 701,276 $ 725,701 $ 93,162 ========= ========= ========= ========= =========

15 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) CONDENSED CONSOLIDATING FINANCIAL STATEMENTS Condensed Consolidated Cash Flows For the nine months ended March 28, 2003

Non- TOTAL Issuer Guarantors Guarantors -------- -------- ---------- ---------- Net cash provided by (used in) operating activities $ (5,627) $(19,537) $ 17,303 $ (3,393) -------- -------- -------- -------- Cash flows from investing activities: Capital expenditures (24,587) (5,013) (14,350) (5,224) Acquisition costs (16,806) -- (16,806) -- Additions to intangibles (807) (571) -- (236) Deposits and other assets 119 74 -- 45 -------- -------- -------- -------- Net cash used in investing activities (42,081) (5,510) (31,156) (5,415) -------- -------- -------- -------- Cash flows from financing activities Repayment of long term debt 36,098 36,007 -- 91 Receipt of additional paid-in capital 392 392 -- -- Change in intercompany accounts -- (11,939) 3,390 8,549 -------- -------- -------- -------- Net cash flows provided by financing activities 36,490 24,460 3,390 8,640 -------- -------- -------- -------- Effect of exchange rate changes on cash (139) -- -- (139) -------- -------- -------- -------- Net decrease in cash (11,357) (587) (10,463) (307) Cash, beginning of period 28,199 9,035 10,660 8,504 -------- -------- -------- -------- Cash, end of period $ 16,842 $ 8,448 $ 197 $ 8,197 ======== ======== ======== ========

For the nine months ended March 29, 2002

Non- TOTAL Issuer Guarantors Guarantors -------- -------- ---------- ---------- Net cash used in operating activities $(15,431) $(13,346) $ (154) $ (1,931) -------- -------- -------- -------- Cash flows from Investing activities: Capital expenditures (12,317) (5,209) (4,779) (2,329) Acquisition costs (65,757) -- (65,757) -- Additions to intangibles 797 (191) 1,206 (218) Deposits and other assets 846 117 299 430 -------- -------- -------- -------- Net cash used in investing activities (76,431) (5,283) (69,031) (2,117) -------- -------- -------- -------- Cash flows from financing activities Repayment of long term debt 6,012 6,298 -- (286) Receipt of additional paid in capital 50,000 50,000 -- -- Payment for treasury stock (60) (60) -- -- Debt financing cost (120) (120) -- -- Change in intercompany accounts -- (68,272) 64,148 4,124 -------- -------- -------- -------- Net cash flows provided by (used in) financing activities 55,832 (12,154) 64,148 3,838 -------- -------- -------- -------- Effect of exchange rate changes on cash 5 -- -- 5 -------- -------- -------- -------- Net decrease in cash (36,025) (30,783) (5,037) (205) Cash, beginning of period 44,645 32,890 5,321 6,434 -------- -------- -------- -------- Cash, end of period $ 8,620 $ 2,107 $ 284 $ 6,229 ======== ======== ======== ========

16 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) NOTE 7- ACQUISITIONS The Company purchased certain assets and assumed certain liabilities of ELM Packaging "ELM" on July 10, 2002, for approximately $16,806, including acquisition costs, in cash. The allocation of the purchase is as follows: Assets: Accounts receivable $ 3,449 Inventories 1,829 Prepaid expenses 334 Deferred Taxes 2,280 Property, Plant & Equipment 12,487 Intangibles including goodwill 11,010 -------- Total Assets 31,389 -------- Accounts payable and accrued liabilities 8,583 Integration reserve 6,000 -------- Net Investment $ 16,806 ======== The Company has utilized preliminary estimates and assumptions in determining the allocation of purchase price to assets acquired and liabilities assumed of ELM. While management believes such estimates and assumptions are reasonable, the final allocation of the purchase price may differ from that reflected in the March 28, 2003 consolidated balance sheet after a more extensive review of fair values of inventory and the acquisition reserve. The Company expects to finalize this allocation in the next three months. In connection with the acquisition, a reserve of $6,000 has been established for the costs to integrate ELM's operations with the Company. The reserve is included in accrued liabilities. The components of the integration reserve and activity through March 28, 2003, is as follows:

BALANCE COSTS CHARGED BALANCE JULY 10, 2002 TO RESERVE MARCH 28, 2003 ------------- ------------- -------------- Manufacturing Reconfiguration $ 2,500 $ 2,157 $ 343 Reduction in personnel and related costs 1,000 729 271 Legal, environmental and other 2,500 2,120 380 -------- -------- -------- $ 6,000 $ 5,006 $ 994 ======== ======== ========

The remaining costs are expected to be paid over the next three to six months. 17 TEKNI-PLEX, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) The proforma results of operations for the quarter and nine months ended March 29, 2002, assuming ELM was acquired on June 30, 2001, would not be materially different from the historical presentation. In October 2001, the Company purchased certain assets and assumed certain liabilities of Swan Hose for approximately $63,600. The acquisition was recorded under the purchase method, whereby Swan's net assets were recorded at estimated fair value and its operations have been reflected in the statement of operations since that date. The components of the Integration reserve and activity through March 28, 2003 is as follows:

BALANCE COSTS CHARGED BALANCE OCTOBER 2001 TO RESERVE MARCH 28, 2003 ------------ -------------- -------------- Cost to close duplicate facilities $ 3,500 $ 2,571 $ 929 Reduction in personnel and related costs 2,100 1,196 904 Legal and environmental 1,275 1,388 (113) Manufacturing reconfiguration 1,455 2,747 (1,292) Other 1,670 2,098 (428) -------- -------- -------- $ 10,000 $ 10,000 $ 0 ======== ======== ========

The following table represents the unaudited proforma results of operations as though the acquisition of Swan occurred on June 30, 2001. Since Swan was purchased subsequent to July 1, 2001, no amortization of goodwill has been reflected in accordance with SFAS 142.

NINE MONTHS ENDED MARCH 29, 2002 ----------------- Net sales $393,593 Operating profit 44,407 Loss before income taxes 12,886 ==========

18 ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS THIRD QUARTER OF FISCAL 2003 COMPARED WITH THE THIRD QUARTER OF FISCAL 2002 Net sales increased to $166.1 million for the three months ended March 28, 2003 from $153.4 million for the three months ended March 29, 2002, representing an 8.3% gain. Net sales in our Packaging Segment grew 16.7%, primarily due to our Elm acquisition which closed in July 2002. Net sales in our Tubing Products Segment grew 2.6% and other net sales grew 4.0%. Cost of Sales increased to $122.0 million for the three months ended March 28, 2003 from $111.4 million for the three months ended March 29, 2002. Expressed as a percentage of net sales, cost of sales increased to 73.4% in the current period compared to 72.6% in the prior period primarily due to higher raw material costs. Gross Profit, as a result of the above, increased to $44.1 million in the current period compared to $42.0 million in the prior period. Expressed as a percentage of net sales, gross profit declined to 26.6% for the three months ended March 28, 2003 from 27.4% in comparable period of last year. Our Packaging Segment gross profit increased to $22.2 million for the three months ended March 28, 2003 from $18.2 million for the three months ended March 29, 2002. Expressed as a percentage of net sales, Packaging Segment gross profit increased to 32.2% in the current period from 30.7% in the previous period. Our Tubing Products Segment gross profit increased to $20.7 million for the three months ended March 28, 2003 from $19.5 million for the three months ended March 29, 2002. Expressed as a percentage of net sales, Tubing Products Segment gross profit increased to 29.8% in the current period from 28.8% in the previous period. Other gross profit fell to $1.3 million for the three months ended March 28, 2003 from $4.4 million for the three months ended March 29, 2002. Selling, General and Administrative expense decreased to $14.6 million in the most recent quarter from $18.5 million in the comparable period of the previous year primarily due to a $4.0 million reduction in amortization expense associated with a required change in accounting for goodwill. Measured as a percentage of net sales, selling, general and administrative expense decreased to 8.8% in the current period from 12.1% in the previous period. Operating Profit, as a result of the above, increased to $29.6 million for the three months ended March 28, 2003 from $23.5 million for the three months ended March 29, 2002. Expressed as a percentage of net sales, operating profit increased to 17.8% in the most recent period from 15.3% in the comparable period of last year. Our Packaging Segment operating profit increased to $17.3 million or 25.1% of net sales in the current period compared to $12.3 million or 20.8% of net sales in the previous period. Our Tubing Products Segment operating profit increased to $17.1 million or 24.7% of net sales in the current period compared to $14.2 million or 21.0% of net sales in the previous period. Other operating profit declined to a loss of $0.3 million in the current period from income of $2.3 million in the previous period. Interest expense decreased to $18.7 million or 11.3% of net sales in the three months ended March 28, 2003 from $19.0 million or 12.4% of net sales for the three months ended March 29, 2002. Unrealized (gain) loss on derivative transactions was a $0.8 million gain or 0.5% of net sales for the three months ending March 28, 2003 compared to a $1.1 million loss or 0.7% of net sales for the three months ending March 29, 2002. The changes were due to changes in the market interest rates underlying our derivatives. Income before income taxes, as a result, was $12.0 million or 7.2% of net sales for the three months ended March 28, 2003 compared to $3.5 million or 2.3% of net sales for the three months ended March 29, 2002. 19 Income tax was $4.4 million for the three months ended March 28, 2003, compared to $1.2 million for the three months ended March 29, 2002. The Company's effective tax rate was 36.8% for the three months ended March 28, 2003 compared to 33.9% for the three months ending March 29, 2002. Net income, as a result, was $7.6 million for the three months ended March 28, 2003 or 4.6% of net sales compared with $2.3 million for the three months ended March 29, 2002 or 1.5% of net sales. 20 FIRST NINE MONTHS OF FISCAL 2003 COMPARED WITH THE FIRST NINE MONTHS OF FISCAL 2002 Net sales increased to $425.3 million for the nine months ended March 28, 2003 from $382.3 million for the nine months ended March 29, 2002, representing an 11.2% gain. Net sales in our Packaging Segment grew 14.0%, primarily due to our Elm acquisition which closed in July 2002. Net sales in our Tubing Products Segment grew 12.8% primarily due to the inclusion of net sales from our Swan acquisition in the first quarter of fiscal 2003. Other net sales grew 2.5%. Cost of Sales increased to $319.9 million for the nine months ended March 28, 2003 from $285.6 million for the nine months ended March 29, 2002. Expressed as a percentage of net sales, cost of sales increased to 75.2% in the current period compared to 74.7% in the prior period primarily due to higher raw material costs. Gross Profit, as a result of the above, increased to $105.4 million in the current period compared to $96.7 million in the prior period. Expressed as a percentage of net sales, gross profit declined to 24.8% for the nine months ended March 28, 2003 from 25.3% in comparable period of last year. Our Packaging Segment gross profit increased to $59.4 million for the nine months ended March 28, 2003 from $49.6 million for the nine months ended March 29, 2002. Expressed as a percentage of net sales, Packaging Segment gross profit increased to 29.8% in the current period from 28.4% in the previous period. Our Tubing Products Segment gross profit increased to $40.3 million for the nine months ended March 28, 2003 from $36.5 million for the nine months ended March 29, 2002. Expressed as a percentage of net sales, Tubing Products Segment gross profit decreased to 27.6% in the current period from 28.2% in the previous period. Other gross profit fell to $5.7 million or 7.1% of net sales for the nine months ended March 28, 2003 from $10.6 million or 13.6% of net sales for the nine months ended March 29, 2002. Selling, General and Administrative expense decreased to $43.0 million in the most recent quarter from $50.3 million in the comparable period of the previous year primarily due to a $12.1 million reduction in amortization expense associated with a required change in accounting for goodwill. Measured as a percentage of net sales, selling, general and administrative expense decreased to 10.1% in the current period from 13.2% in the previous period. Operating Profit, as a result of the above, increased to $62.3 million for the nine months ended March 28, 2003 from $46.4 million for the nine months ended March 29, 2002. Expressed as a percentage of net sales, operating profit increased to 14.7% in the most recent period from 12.1% in the comparable period of last year. Packaging Segment operating profit increased to $44.8 million or 22.5% of net sales in the current period compared to $32.5 million or 18.6% of net sales in the previous period. Tubing Products Segment operating profit increased to $30.0 million or 20.6% of net sales in the current period compared to $22.6 million or 17.5% of net sales in the previous period. Other operating profit declined to $0.8 million in the current period from $4.3 million in the previous period. Interest expense increased to $54.0 in the nine months ended March 28, 2003 from $53.4 million in the nine months ended March 29, 2002. Expressed as a percentage of net sales, interest expense decreased to 12.7% in the current period compared to 14.0% in the comparable period of last year. Unrealized (gain) loss on derivative transactions was a $1.3 million loss or 0.3% of net sales for the nine months ending March 28, 2003 compared to a $3.7 million loss or 1.0% of net sales for the nine months ending March 29, 2002. The changes were due to changes in the market interest rates underlying our derivatives. Income (loss) before income taxes, as a result, was $7.0 million for the nine months ended March 28, 2003 compared to a loss of ($10.9) million for the nine months ended March 29, 2002. 21 Income tax expense (benefit) was $2.7 million for the nine months ended March 28, 2003, compared to a benefit of ($3.8) million for the nine months ended March 29, 2002. The Company's effective tax rate was 38.0% for the nine months ended March 28, 2003 compared to 35.0% for the nine months ending March 29, 2002. Net income (loss), as a result, was $4.4 million for the nine months ended March 28, 2003 compared with a loss of ($7.1) million for the nine months ended March 29, 2002. LIQUIDITY AND CAPITAL RESOURCES Net cash used in operations for the nine months ended March 28, 2003 was $5.6 million compared with $15.4 million in the same period of the prior year. The decrease of $9.8 million was primarily due to a larger seasonal reduction in accounts receivable at our garden hose unit compared to last year. Working capital on March 28, 2003 was $231.9 million compared to $216.9 million on June 28, 2002. The increase was due primarily to a normal seasonal increase in garden hose inventories. As of March 28, 2003, the Company had an outstanding balance of $88.0 million under the $100.0 million revolving credit line. This represents an increase of $42.0 million from the outstanding balance as of June 28, 2002. The Company's capital expenditures for the nine months ended March 28, 2003 and March 29, 2002 were $24.6 million and $12.3 million respectively. In addition, the Company paid $16.8 million for acquisitions in the nine months ending March 28, 2003 compared to $65.8 million in the comparable period of the previous year. The Company continues to expect that its principal uses of cash for the next several years will be acquisitions, debt service, capital expenditures and working capital requirements. Management believes that cash generated from operations plus funds available in the Company's credit facility will be sufficient to meet its needs and to provide it with the flexibility to make capital expenditures and acquisitions which management believes will provide an attractive return on investment. However, the Company may need additional financing to take advantage of acquisition opportunities that may arise in the next several quarters. There can be no assurance that such financing will be available in the amounts required for such acquisitions and on terms acceptable to the Company. ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company is subject to market risk inherent in certain debt instruments. At March 28, 2003, the principal amount of the Company's aggregate outstanding variable rate indebtedness was $410.9 million. A hypothetical 10% adverse change in interest rates would have an annualized unfavorable impact of approximately $1.3 million on the Company's after-tax earnings and cash flows, assuming the Company's current effective tax rate and assuming no change in the principal amount. Conversely, a reduction in interest rates would favorably impact the Company's after-tax earnings and cash flows in a similar proportion. To mitigate these risks, in June 2000, the Company entered into interest rate Swap and Cap Agreements for a notional amount of $344,000. ITEM 4. Controls and Procedures 22 (a) Evaluation of disclosure controls and procedures. Our chief executive officer and our chief financial officer, after evaluating the effectiveness of the Company's "disclosure controls and procedures" (as defined in Exchange Act Rules 13a-14(C) and 15-d-14(C)) as of a date (the "Evaluation Date") within 90 days of the filing date of this quarterly report, have concluded that as of the Evaluation Date, our disclosure controls and procedures were adequate and designed to ensure that material information relating to us and our consolidated subsidiaries would be made known to them by others within those entities. (b) Changes in internal controls. There were no significant changes in our internal controls or to our knowledge, in other factors that could significantly affect our internal controls subsequent to the Evaluation Date. PART II. OTHER INFORMATION Item 1 Legal Proceedings The Company is party to certain litigation in the ordinary course of business, none of which the Company believes is likely to have a material adverse effect on its consolidated financial position or results of operations. Item 2. Changes in Securities None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Securities holders Not applicable Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K (a) Reports on Form 8-K None 23 CERTIFICATION I, Dr. F. Patrick Smith, Chairman of the Board and Chief Executive Officer of Tekni-Plex, Inc., certify that: 1. I have reviewed this quarterly report on Form 10-Q of Tekni-Plex, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: May 12, 2003 By: /s/ Dr. F. Patrick Smith ------------------------ Dr. F. Patrick Smith Chairman and Chief Executive Officer 24 CERTIFICATION I, James E. Condon, Chief Financial Officer of Tekni-Plex, Inc., certify that: 1. I have reviewed this quarterly report on Form 10-Q of Tekni-Plex, Inc.; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: May 12, 2003 By: /s/ James E. Condon ------------------- James E. Condon Chief Financial Officer 25 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Tekni-Plex, Inc. (the "Company") on Form 10-Q for the period ending March 28, 2003 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Dr. F. Patrick Smith, Chairman and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. BY: /s/ DR. F. PATRICK SMITH Dr. F. Patrick Smith Chairman and Chief Executive Officer May 12, 2003 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Tekni-Plex, Inc. (the "Company") on Form 10-Q for the period ending March 28, 2003 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, James E. Condon, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. BY: /s/ JAMES E. CONDON James E. Condon Chief Financial Officer May 12, 2003 26 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TEKNI-PLEX, INC. May 12, 2003 By: /s/ F. Patrick Smith -------------------- F. Patrick Smith Chairman of the Board and Chief Executive Officer By: /s/ Kenneth W.R. Baker ----------------------- Kenneth W. R. Baker President and Chief Operating Officer By: /s/ James E.Condon ------------------ James E.Condon Vice President and Chief Financial Officer 27