Olson Plans to Sell Assets, Restructure Credit Lines

Olson Industries, facing a cash crunch after a dismal 1987, plans to sell assets and restructure its credit with its banks and other lenders.

The plastics packaging concern, based in Sherman Oaks, disclosed the plans as part of an announcement that it lost $1.92 million in the fourth quarter and $7.41 million for the full year.

Those losses prompted the company to “to restructure credit lines and sell non-operating assets to relieve liquidity problems,” the company said in an announcement. It did not elaborate.

Richard G. Olson, vice president and treasurer, said in a telephone interview that any assets sold would not be part of Olson’s operations. He said the company has non-operating assets such as land and notes receivable (loan payments due Olson) that could be sold, but he declined to comment further.

Olson said the loss for the quarter ended Dec. 31 came on sales of $15.9 million, and compared with year-earlier profit of $1.57 million, or $2.24 a share, on sales of $15.6 million.

The full-year loss, which included $4.64 million in losses from a large egg business that Olson discontinued, came on sales of $62.7 million. In 1986, Olson earned $3.97 million, or $5.67 a share, on sales of $58.4 million.

Olson blamed its latest quarterly loss on continued price increases of the resins that are the main raw material in Olson’s packaging products, which include the trays used for McDonald’s hamburgers. At the same time, Olson said it has not been able to pass all of the higher costs to its customers and remain competitive with other suppliers.

However, Olson said it looks for “a gradual decrease” in resin prices later this year or in early 1989 “as domestic resin capacities increase.”