19th Oct 2018 09:42
LONDON (Alliance News) - Packaging and plastic products manufacturers Essentra PLC on Friday reiterated its annual views and said that third quarter trading reflected benefits of strategic actions and increasing stability across the company.
Essentra, which manufactures knobs, handles, adhesive tapes, caps and plugs, added that it will record a GBP12 million exceptional charge in the second half of 2018 due to the intended closure of the commercial print and consumer packaging site in Largo, US, as well as consultation processes at the company's commercial print facility in Kilmarnock and Nottingham in the UK.
The Largo facility in Florida is expected to close by the end of 2018 and, if the proposals in the UK are confirmed, the Kilmarnock site would close and Speciality Tapes cease production in Nottingham by the same time. For the nine months ended September 30, the businesses generated combined revenue of GBP16 million and an operating loss of GBP1 million.
Essentra expects the GBP4 million cash element of the exceptional charge to be offset by proceeds from the disposal of the assets and freehold property in Largo.
For the three months to September-end, Essentra recorded flat like-for-like revenue. It was up 1.5% when adjusting for the closure of the company's Newport cartons manufacturing site.
"The return to growth across our packaging division is particularly gratifying and, being well underpinned, is set to continue. Accordingly, we remain confident that we are on track to deliver an improvement in both revenue and operating margin for the company," said Chief Executive Paul Forman.
The stock was 3.4% lower at 372.60 pence each on Friday afternoon.
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