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BPI to beat profits forecast
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01/07/2009
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The Scottish-based plastic packaging plc British Polythene Industries (BPI) announced today (1 July) that its first half profits would be "comfortably ahead of previous expectations".In an update on current trading, BPI confirmed that, even after absorbing the £2 million of restructuring costs linked with the closure of its Stockton and Cowdenbeath operations, profits would be comfortably ahead of our previous expectations for what is traditionally the company's better first half.
This had been achieved despite lower overall volumes and a difficult trading environment and was mainly due to more stable input costs, a reduced cost base, more favourable rates of exchange and slightly better than anticipated demand from certain sectors.
Sales of the stretch plastic used to produce silage were broadly on target after six months, but BPI said it could not as yet anticipate that they would reach the exceptional volumes of 2008, when the very wet summer extended the silage season.
Construction-related demand remained depressed, although sales of packaging for bagged aggregates had been slightly better than expected.
Demand from the horticultural sector for packaging for garden composts had been better than for many years.
In the supply chain, polymer suppliers were currently pressing for increases in polymer prices in an attempt to recover internal feedstock transfer prices. "It remains to be seen how successful they will be," BPI said.
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Author
Ken Hurst
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