BRITISH POLYTHENE INDUSTRIES
Operating profits fall despite revenue increase / Sale of UK site boosts pretax performance / Ongoing restructuring accompanied by greater capital expenditure
Operating profits dropped almost 11% to GBP 12.2m (EUR 14.6m) at British Polythene Industries (BPI, Greenock, Scotland / UK; www.bpipoly.com) in the six months to 30 June 2010, but a GBP 3.5m gain from the sale of the group’s Stockton / UK site led to pretax profits increasing by over 40% to GBP 13.1m. Rising selling prices prompted by higher input costs and a 3.5% increase in volumes were the main factors behind a 12.7% revenue improvement to GBP 260.8m (H1 2009: GBP 231.4m). Net borrowings were reduced from GBP 55.1m to GBP 49.5m.
Chairman Cameron McLatchie said the BPI board had been encouraged by the group’s performance during difficult trading conditions, the progress in restructuring and the cash generated. Total volumes sold in the UK and Ireland increased slightly to 110,500 t but operating profits for the region dropped from GBP 7.8m to GBP 5.7m as margins suffered from continued increases in raw material prices. Sales of wide agricultural and horticultural film improved by 15% year-on-year, while refuse sack sales were ahead 9%, and recycling volumes also increased. Sales of silage stretch film, however, have been below 2009 levels due to the dry, warm weather restricting grass growth; the season could now extend into October.
Operating profit in mainland Europe improved by more than 10% to GBP 6.2m as the tonnage sold rose from 36,900 t in 2009 to 40,700 t this year. The increase was due to a recovery in industrial markets and full utilisation of increased silage capacity. Very competitive conditions in the North American horticultural market restricted the recovery in sales volumes there to just 4%, or 5,100 t, and meant operating profits remained static at GBP 0.3m.
The GBP 6m sale of BPI’s plant in Stockton was wrapped up in late June and the site’s equipment transferred to BPI’s facilities in Greenock and Ardeer. In closing its plant in Brampton / UK and shifting production to Bromborough / UK, BPI also has reduced the cost base of its UK Films business. The ongoing restructuring programme is being accompanied by higher capital expenditure, GBP 7.7m of which was spent in the first half-year. The leading investment has been the new extrusion hall and 15,000 t/y five-layer film line at Ardeer / Scotland. An 8-colour printing press is currently being installed at Zele / Belgium, which should create further growth in the sales of printed film to the food industry, and a new blown film line for the manufacture of silage stretch wrap will be commissioned in Edmonton / Canada in September.
Volumes are expected to remain sound in the second half-year, but McLatchie says the outcome for the year will depend on a respite from polymer price increases and the operational efficiencies taken to improve the cost base. BPI posted a pretax profit of GBP 11.8m in the year to 31 December 2009 – see Plasteurope.com of 03.03.2010.
e-Service:
BPI interim results for H1 2010 as a PDF document
Chairman Cameron McLatchie said the BPI board had been encouraged by the group’s performance during difficult trading conditions, the progress in restructuring and the cash generated. Total volumes sold in the UK and Ireland increased slightly to 110,500 t but operating profits for the region dropped from GBP 7.8m to GBP 5.7m as margins suffered from continued increases in raw material prices. Sales of wide agricultural and horticultural film improved by 15% year-on-year, while refuse sack sales were ahead 9%, and recycling volumes also increased. Sales of silage stretch film, however, have been below 2009 levels due to the dry, warm weather restricting grass growth; the season could now extend into October.
Operating profit in mainland Europe improved by more than 10% to GBP 6.2m as the tonnage sold rose from 36,900 t in 2009 to 40,700 t this year. The increase was due to a recovery in industrial markets and full utilisation of increased silage capacity. Very competitive conditions in the North American horticultural market restricted the recovery in sales volumes there to just 4%, or 5,100 t, and meant operating profits remained static at GBP 0.3m.
The GBP 6m sale of BPI’s plant in Stockton was wrapped up in late June and the site’s equipment transferred to BPI’s facilities in Greenock and Ardeer. In closing its plant in Brampton / UK and shifting production to Bromborough / UK, BPI also has reduced the cost base of its UK Films business. The ongoing restructuring programme is being accompanied by higher capital expenditure, GBP 7.7m of which was spent in the first half-year. The leading investment has been the new extrusion hall and 15,000 t/y five-layer film line at Ardeer / Scotland. An 8-colour printing press is currently being installed at Zele / Belgium, which should create further growth in the sales of printed film to the food industry, and a new blown film line for the manufacture of silage stretch wrap will be commissioned in Edmonton / Canada in September.
Volumes are expected to remain sound in the second half-year, but McLatchie says the outcome for the year will depend on a respite from polymer price increases and the operational efficiencies taken to improve the cost base. BPI posted a pretax profit of GBP 11.8m in the year to 31 December 2009 – see Plasteurope.com of 03.03.2010.
e-Service:
BPI interim results for H1 2010 as a PDF document
06.09.2010 Plasteurope.com [217182]
Published on 06.09.2010
German version of this article...