AT Plastics today announced financial results for the third quarter and nine months ended September 30, 2001.

The focus of the accompanying financial statements is on the Company's continuing operations, the Specialty Polymers and Films businesses. The Wire & Cable business, which was sold May 31, 2001 and the Packaging business, which is in the process of being sold, have been presented as discontinued operations.

"The third quarter results show steady improvement as raw material costs have declined in response to market demand and falling natural gas prices. We are pleased with this performance in light of softening economic conditions and an immediate fall off in volume after Sept. 11th," said Gary Connaughty, President and CEO. "Average selling prices for AT Plastics' specialty products have been holding compared to declining prices for commodity resin. This validates AT Plastics' specialty focus strategy and points to improved profitability as polyethylene market conditions improve."

"We believe the success of our share issue, which was oversubscribed, demonstrates confidence in our new strategic direction of focusing on core operations where we have a strong market position, and withdrawing from non-core operations," said George Czubak, Chief Financial Officer. "We have paid down debt by $23 million in the third quarter, and are in discussions to refinance the remaining debt. We are also in final negotiations for the sale of our Packaging business."

Financial Summary

The Company reported sales of $62.3 million from continuing operations in the third quarter of fiscal 2001, 3.6% lower than the same quarter last year. For the first nine months revenue was $189.6 million, essentially flat compared with $192.9 million in the first nine months of 2000. Higher selling prices, due to improved mix, were essentially offset by reduced volumes.

Earnings before interest, taxes, depreciation, amortization and special charges (EBITDA) from continuing operations, increased 38% to $9.7 million from $7.0 million in the second quarter, primarily reflecting declining feedstock costs and implemented cost controls. Compared to last year however, year to date EBITDA of $23.6 million is significantly lower primarily due to the higher cost of ethylene raw material driven by the unprecedented spike in natural gas prices in early 2001. The Company estimates the impact of this gas spike under present market conditions to be as much as $15 million against year to date EBITDA.

The Company reported Special Charges amounting to $7.9 million in the third quarter representing anticipated lender exit charges related to the debt refinancing, professional fees related to the Company's restructuring program, and losses on the buy-out of remaining US exchange hedge contracts.

In the quarter the Company reported a net loss from continuing operations of $8.4 million or $0.21 per share after special charges. This compares with a net loss of $4.5 million in the second quarter and a net income from continuing operations of $1.9 million in the same quarter of 2000 when no special charges were incurred. For the first nine months the Company reported a net loss from continuing operations after, special charges, of $15.7 million or $0.44 per share, compared with a net income of $752,000 or $0.02 per share in the same period a year ago. Including discontinued operations, in the first nine months of 2001 the Company reported a net loss of $16.9 million, compared with a net loss of $1.1 million in the same period last year. Excluding the impact of the unprecedented natural gas spike and special charges, earnings would have been about the same as last year.

Specialty Polymers

In the third quarter, Specialty Polymers volumes declined compared to the second quarter of this year, reflecting the general economic slowdown and the tragic events of September 11. Business Unit revenue was $50.3 million on volume of 63.3 million pounds in the third quarter compared to $52.3 million in revenue and 66.9 million pounds in the same quarter last year. Average selling prices have increased reflecting improved product mix.

Year to date Business Unit revenue is $164.4 million, only slightly down from $169.5 million from same period last year reflecting lower volumes partially offset by higher prices. Lower volumes reflect lower sales of off-grade product due to increased manufacturing efficiency; prime grade product sales volumes have increased from last year.

Results for the Specialty Polymers Business Unit have also benefitted from cost reduction programs.

Films

In the third quarter of fiscal 2001, horticultural and agricultural films volumes and revenues increased from the second quarter primarily due to the seasonal nature of the business. Revenue was $15.5 million on volume of 9.4 million pounds in the third quarter compared to $14.1 million revenue and 8.5 million pounds of volume in the second quarter. It is expected that the positive seasonal effect will extend into the fourth quarter of this year due to the delayed harvest season that the Midwestern United States is currently experiencing.

Year to date revenue of $35.2 million and volume of 21.9 million pounds was slightly lower than last year. Volume was ahead of last year until Sept.11th.

Hedging

The Company entered into natural gas forward call contracts in the third quarter when gas prices were at a low point, to protect against potential ethylene feedstock cost increases driven by a potential increase in natural gas prices in December 2001, January and February 2002.

During the quarter the Company bought out its remaining US dollar hedging contracts which had been set at unfavourable rates. Going forward it is expected that the Company will benefit from favourable Canadian/US exchange rates on its exports.

Outlook

AT Plastics expects the economic slowdown for the petrochemicals industry to be longer than earlier projected, reflecting the general level of economic activity. However, AT Plastics is positioned to perform better than the industry, given its focus on specialty plastics and its initiatives to increase market share, with an emphasis on higher margin business through a customer targeting and servicing program. The Company will also benefit from lower raw material costs, the lower Canadian dollar in relation to its previous hedge program, and a stronger financial base following completion of the restructuring program announced in the second quarter which is targeted to be completed by December 31, 2001.

Management will host a conference call with a live audio webcast on Tuesday, October 30th at 4:00 p.m. EST to discuss the Company's third quarter results. To access the simultaneous webcast, please visit AT Plastics website at www.atplas.com, Q1234.com's website at www.Q1234.com or CNW's website at www.newswire.ca for directions. Participants will require RealPlayer(TM) and Acrobat Reader, which can be downloaded prior to accessing the call. Please note that the webcast allows participants to listen only.

Forward-Looking Statements

All statements in this quarterly report that do not directly and exclusively relate to historical facts constitute "forward-looking statements" within the Private Securities Litigation Reform Act of 1995. Forward-looking statements regarding future events or future financial performance represent AT Plastics' expectations, plans, intentions, and beliefs and are subject to risks, uncertainties and other factors of which many are beyond the control of the Company. These factors include but are not restricted to raw material costs, competitive pricing, currency fluctuations, and economic cycles affecting demand and prices, and other risks identified in Management's Discussion and Analysis in AT Plastics' annual report. AT Plastics disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

AT Plastics develops and manufactures specialty plastics raw materials and fabricated products. The Company operates in specialized markets where its product development and process engineering have allowed it to develop proprietary and patented technologies to meet evolving customer requirements in niche markets. Products are sold in the United States, Canada and internationally. AT Plastics' shares are listed on The Toronto Stock Exchange, under the trading symbol "ATP", and on the American Stock Exchange, under the trading symbol "ATJ." AT Plastics may be contacted through its website: www.atplas.com.

AT Plastics Inc.

Consolidated Statements Of Operations and Retained Earnings (Deficit)

For The Periods Ended September 30, 2001 and 2000 (Unaudited) (Thousands of dollars, except per share amounts)

3 Months Ended 9 Months Ended Restated Restated Sept. 30, Sept. 30, Sept. 30, Sept. 30, 2001 2000 2001 2000 -------------------- ---------------------

SALES $62,323 $64,639 $189,587 $192,890 COST OF SALES AND OTHER EXPENSES 52,619 50,656 166,032 157,506 -------------------------------------------------------------------- INCOME BEFORE THE UNDERNOTED ITEMS 9,704 13,983 23,555 35,384

Interest on long-term debt 6,449 4,704 16,388 14,442 Depreciation and amortization 7,118 5,888 18,562 16,117 Other interest (income) expense (215) 280 (100) 1,142 Special charges (Note 6) 7,875 - 9,854 1,771 -------------------------------------------------------------------- 21,227 10,872 44,704 33,472 -------------------------------------------------------------------- INCOME ( LOSS ) BEFORE INCOME TAXES (11,523) 3,111 (21,149) 1,912 INCOME TAXES (RECOVERY) Current 200 88 626 682 Future (3,325) 1,083 (6,116) 478 -------------------------------------------------------------------- (3,125) 1,171 (5,490) 1,160 -------------------------------------------------------------------- NET INCOME ( LOSS ) FROM CONTINUING OPERATIONS FOR THE PERIOD (8,398) 1,940 (15,659) 752 INCOME (LOSS) FROM DISCONTINUED OPERATIONS (Note 4) 359 (698) (1,251) (1,866) --------------------------------------------------------------------

NET INCOME (LOSS) FOR THE PERIOD (8,039) 1,242 (16,910) (1,114)

RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD AS PREVIOUSLY REPORTED: (17,755) 14,466 (8,884) 28,575 ADJUSTMENTS: Employee future benefits - - (9,243) Future income taxes - - (2,508) -------------------------------------------------------------------- AS RESTATED (17,755) 14,466 (8,884) 16,824 RETAINED EARNINGS (DEFICIT) AT END OF PERIOD (25,794) 15,708 (25,794) 15,710 -------------------------------------------------------------------- -------------------------------------------------------------------- AVERAGE NUMBER OF SHARES OUTSTANDING (000's) 40,484 33,269 35,701 30,753 -------------------------------------------------------------------- -------------------------------------------------------------------- NET INCOME (LOSS) PER SHARE - BEFORE DISCONTINUED OPERATIONS (0.21) 0.06 (0.44) 0.02 NET INCOME ( LOSS ) PER SHARE ($0.20) $0.04 ($0.47) ($0.04) -------------------------------------------------------------------- --------------------------------------------------------------------

AT Plastics Inc. Consolidated Balance Sheets As at September 30, 2001 and December 31, 2000. (Unaudited) (Thousands of dollars)

Sept. 30, 2001 Dec. 31, 2000 -------------- ------------- ASSETS CURRENT Cash $13,744 $24 Accounts receivable 51,345 43,197 Inventory 53,712 62,223 Prepaids 1,523 1,154 -------------------------------------------------------------------- 120,324 106,598 FIXED 326,905 343,891 OTHER 15,489 18,246 -------------------------------------------------------------------- $462,718 $468,735 -------------------------------------------------------------------- -------------------------------------------------------------------- LIABILITIES & SHAREHOLDERS' EQUITY CURRENT Accounts payable and accrued liabilities $39,852 $46,063 Current portion of long-term debt (Note 4a) 206,893 14,815 -------------------------------------------------------------------- 246,745 60,878 EMPLOYEE FUTURE BENEFITS 7,484 7,084 FUTURE INCOME TAXES (5,018) 2,702 LONG-TERM DEBT (Note 4a) - 200,821 -------------------------------------------------------------------- 249,211 271,485 -------------------------------------------------------------------- SHAREHOLDERS' EQUITY Capital stock 239,301 206,134 Deficit (25,794) (8,884) -------------------------------------------------------------------- 213,507 197,250 -------------------------------------------------------------------- $462,718 $468,735 -------------------------------------------------------------------- --------------------------------------------------------------------

Certain comparative figures have been reclassified to conform with the current year's presentation.

Consolidated Statements Of Cash Flows For The Periods Ended September 30, 2001 and 2000 (Unaudited) (Thousands of dollars)

3 Months Ended 9 Months Ended Restated Restated Sept. 30, Sept. 30, Sept. 30, Sept. 30, 2001 2000 2001 2000 -------------------- --------------------- (000's) (000's) CASH FROM ( FOR ) OPERATING ACTIVITIES OPERATIONS Net income ( loss ) for the period ($8,039) $1,242 ($16,910) ($1,114) Adjustments for: Depreciation and amortization 7,745 7,116 20,471 20,659 Future income taxes (3,187) 620 (6,866) (812) -------------------------------------------------------------------- (3,481) 8,978 (3,305) 18,733 -------------------------------------------------------------------- Changes in non-cash working capital Accounts receivable (712) 5,394 (8,148) (6,082) Inventory (1,269) (5,237) 5,173 (7,114) Prepaids (1,003) 517 (369) (33) Accounts payable and other liabilities (1,343) (4,430) (5,811) (14,019) -------------------------------------------------------------------- (4,327) (3,756) (9,155) (27,248) -------------------------------------------------------------------- -------------------------------------------------------------------- Cash from operations including changes in working capital (7,808) 5,222 (12,460) (8,515) -------------------------------------------------------------------- FINANCING ACTIVITIES Common shares issued 33,167 - 33,167 34,033 Long term debt issued - - 11,981 18,326 Long term debt paid (23,544) (693) (23,631) (34,990) -------------------------------------------------------------------- 9,623 (693) 21,517 17,369 -------------------------------------------------------------------- INVESTING ACTIVITIES Proceeds from sale of Wire & Cable business - - 9,410 - Purchase of fixed assets (1,143) (2,610) (3,823) (5,149) Increase in other assets (418) (1,953) (924) (4,767) -------------------------------------------------------------------- (1,561) (4,563) 4,663 (9,916) -------------------------------------------------------------------- INCREASE ( DECREASE ) IN CASH DURING THE PERIOD 254 (34) 13,720 (1,062) CASH AT BEGINNING OF PERIOD 13,490 34 24 1,062 -------------------------------------------------------------------- CASH AT END OF PERIOD $13,744 $0 $13,744 $0 -------------------------------------------------------------------- --------------------------------------------------------------------

Supplemental cash flow information: Interest paid 10,394 4,368 16,184 14,583 Income taxes paid 200 88 626 682 --------------------------------------------------------------------

Segmented Information For The Periods Ended September 30, 2001 and 2000 (Unaudited) (Thousands of dollars)

3 Months Ended 9 Months Ended Restated Restated Sept. 30, Sept. 30, Sept. 30, Sept. 30, 2001 2000 2001 2000 -------------------- --------------------- Revenues Specialty Polymers $50,304 $52,287 $164,451 $169,540 Films 15,494 16,420 35,233 36,571 -------------------------------------------------------------------- 65,798 68,707 199,684 206,111 Elimination of Inter-segment sales (3,475) (4,068) (10,097) (13,221) -------------------------------------------------------------------- 62,323 64,639 189,587 192,890 -------------------------------------------------------------------- External revenue consists of: Specialty Polymers 46,852 48,342 154,368 156,576 Films 15,471 16,297 35,219 36,314 -------------------------------------------------------------------- 62,323 64,639 189,587 192,890 -------------------------------------------------------------------- Earnings Before Interest, Income Taxes, Depreciation, Amortization and Special Charges Specialty Polymers 9,831 13,245 26,334 37,675 Films 1,795 2,903 2,504 4,824 Corporate and other (1,922) (2,165) (5,283) (7,115) -------------------------------------------------------------------- 9,704 13,983 23,555 35,384 -------------------------------------------------------------------- Depreciation & Amortization Specialty Polymers 4,715 4,849 13,871 13,569 Films 455 493 1,484 1,408 Corporate and other 1,948 546 3,207 1,140 -------------------------------------------------------------------- 7,118 5,888 18,562 16,117 -------------------------------------------------------------------- Segment Operating Profits Specialty Polymers 5,116 8,396 12,463 24,106 Films 1,340 2,410 1,020 3,416 Corporate and other (3,870) (2,711) (8,490) (8,255) -------------------------------------------------------------------- 2,586 8,095 4,993 19,267 -------------------------------------------------------------------- Interest on long term debt 6,449 4,704 16,388 14,442 Interest expense (215) 280 (100) 1,142 Special charges 7,875 - 9,854 1,771 -------------------------------------------------------------------- 14,109 4,984 26,142 17,355 -------------------------------------------------------------------- -------------------------------------------------------------------- Income ( Loss ) Before Income Taxes (11,523) 3,111 (21,149) 1,912 -------------------------------------------------------------------- -------------------------------------------------------------------- Income Taxes (Recovery) Current 200 88 626 682 Future (3,325) 1,083 (6,116) 478 -------------------------------------------------------------------- (3,125) 1,171 (5,490) 1,160 -------------------------------------------------------------------- -------------------------------------------------------------------- Net Income (loss) from Continuing Operations (8,398) 1,940 (15,659) 752 -------------------------------------------------------------------- -------------------------------------------------------------------- Income (Loss) from Discontinued Operations 359 (698) (1,251) (1,866) -------------------------------------------------------------------- Net Income (Loss) for the Period (8,039) 1,242 (16,910) (1,114) -------------------------------------------------------------------- --------------------------------------------------------------------

Results by Geographic Segment Segment Revenues Canada 12,176 14,960 48,031 50,730 United States 45,016 43,256 122,782 121,836 Other 5,131 6,423 18,774 20,324 -------------------------------------------------------------------- 62,323 64,639 189,587 192,890 -------------------------------------------------------------------- Revenues from Discontinued Operations 12,913 15,410 46,414 51,699 -------------------------------------------------------------------- Total Revenues $75,236 $80,049 $236,001 $244,589 -------------------------------------------------------------------- --------------------------------------------------------------------