SEYMOUR, Indiana, October 28, 2013 — Cereplast, Inc. (OTCQB: CERP) (the “Company”), a leading manufacturer of proprietary biobased, compostable and sustainable bioplastics, today is providing an update on the European Union (EU) Environmental Commission’s (the Commission) legislation regarding the use of single-use disposable plastic bags on the continent. In a recent document, the EU Environmental Commission stated that they support an amendment to the Packaging and Packaging Waste Directive 94/62/EC (PPWD) that would require all member states of the EU to ban or tax the use of conventional plastic carrier bags that are 50 microns or less. The law is scheduled to go into effect on November 15, 2013, and member states will have two years to comply. This legislation could create demand for 1 million tons per year of bioplastic alternatives to conventional plastic bags, or approximately $4 billion in potential revenue annually.
EU Member states will have the option of imposing outright bans or taxing the use of single-use plastic carrier bags. The Commission aims to reduce the consumption of conventional plastic bags to 20% of current levels. Many EU states already ban or tax the use of plastic bags including Italy, Denmark, Ireland and Bulgaria. Retailers in France, the Netherlands, Germany, Portugal and Hungary have already begun voluntarily charging a fee for conventional plastic bags. This legislation will require all EU member states to take action to drastically reduce plastic bag consumption in their respective states.
The Company is expecting the Italian legislation to become effective following the confirmation of this Directive. The surge in demand, which the Company has anticipated, appears to be imminent. As the Company previously reported, it estimates the annual revenue potential from Italy could exceed $50 million, subject to sufficient access to raw materials and the necessary working capital to finance the growth. The Company currently has the necessary manufacturing capacity in its state-of-the-art facility located in Seymour, IN to serve up to 40,000 Tons or approximately $125 million in annual revenues running at full capacity.
Mr. Frederic Scheer, Chairman and CEO of Cereplast commented, “This legislation will create tremendous revenue opportunities for both the bioplastics industry as a whole, and for Cereplast specifically. The Company is poised to take advantage of the increased demand for bioplastic resins in the EU, and is already working with several customers in Italy, Germany, France and Spain in preparation for this EU-wide change. We anticipate a substantial revenue impact in 2014 as a result of this legislation.”
About Cereplast, Inc.
Cereplast, Inc. (OTCQB:CERP) designs and manufactures proprietary biobased, sustainable bioplastics which are used as substitutes for traditional plastics in all major converting processes – such as injection molding, thermoforming, blow molding and extrusions – at a pricing structure that is competitive with traditional plastics. On the cutting-edge of biobased plastic material development, Cereplast now offers resins to meet a variety of customer demands. Cereplast Compostables® resins are ideally suited for single-use applications where high biobased content and compostability are advantageous, especially in the food service industry. Cereplast Sustainables® resins combine high biobased content with the durability and endurance of traditional plastic, making them ideal for applications in industries such as automotive, consumer electronics and packaging.