In reporting its first quarter results this week, Glatfelter assured analysts that quarterly setbacks like lower volumes in its airlaid business and cost pressures in the Russian wallpaper market, which led to lower sales, are temporary. In fact, Glatfelter’s top brass continues to be bullish about airlaid, and its product development team has already introduced a lower cost wallcovering product to the challenged Russian and Ukraine region.

In Glatfelter’s Advanced Airlaid Business Unit, first quarter sales were down 2.5% on a constant currency basis compared to the same period last year. Shipping volumes were down 4.1% total and 7.5% within the hygiene market due to customer inventory management, the company reports.

Segment sales decreased 12%, or 4% when adjusted for currency fluctuations, to $62.3 million during the quarter. While operating income decreased to $5.2 million.

CEO Dante Parrini reminded analysts that last quarter results reflected Glatfelter’s participation in the launch of a major adult incontinence product, which led to higher-than-average capacity usage. Meanwhile, this quarter’s volume decrease was related to some fluctuations in basis weights. Square meter volumes were very similar to the previous reporting period.

Glatfelter’s three core areas for airlaid, feminine hygiene cores, wipes and adult incontinence components, continue to be strong, according to executives, with each segment forecast to grow about 5% per year. The company is on track to introduce a dispersible substrate to the wipes market during the second half of the year.

“We are still bullish on this segment,” Parrini says. “We are  assessing the North American supply and demand picture and how we can support our customers in this region.”

Executives did not comment on any plans to increase or acquire additional capacity.

Meanwhile, Glatfelter’s’ Composite Fibers Business Unit sales decreased 14.7% during the quarter due to unfavorable currency translation as well as lower shipping volumes. This unit was hit particularly hard by the economic crises in Russia and the Ukraine region. Here, currency devaluation priced Glatfelter’s nonwoven wallcovering products out of the market resulting in a 22% sales decline. Already on the defensive, Glatfelter introduced a lower-cost, lower basis-weight product to this region in March and executives expect sales to begin climbing upward this quarter.

The bright spot of the composite fibers business unit was the coffee and tea business, which grew 3%, thanks largely to the single-serve coffee market, which grew 10% during the year.