10th Jan 2019 10:18
LONDON (Alliance News) - White label household products maker McBride PLC said Thursday its expects full-year results to be in line with expectations despite cost pressures in the first half of the year, as revenue grew.
For the six months ended December, constant currency revenue from continuing operations was 11% higher. Excluding the impact of Danlind AS, underlying revenue was 6.0% higher.
In September 2017, McBride acquired Denmark-based washing and laundry product maker Danlind for GBP10.8 million.
Underlying household division sales were 5.9% higher, driven by sales in the east and in the UK.
"The group has made significant strategic progress in the first half of this financial year completing the sale of Personal Care Liquids, integrating Danlind onto the McBride systems and managing our revenue growth," McBride Chief Executive Officer Rik de Vos said.
During the year, McBride set about exiting its loss-making personal care & aerosols unit. In February, it sold its skincare business in Brno in the Czech Republic and closed its UK aerosol operations in Hull. In July, it agreed to sell its personal care liquids business to Royal Sanders BV.
McBride added that raw material, packaging and logistics costs were "higher than anticipated" during the period. This was particularly true during the second quarter.
McBride emphasised this has been "partly mitigated by improved sales volumes and lower overheads" and that the "pricing outlook for many of our key raw materials has improved recently".
Assuming the costs position not worsening once more, the company therefore expects annual earnings to be in line with expectations. McBride anticipates profit to be weighted towards the second half of the financial year, however.
"Margins remain our key focus at present and the recent improvement in the pricing outlook for raw materials following almost two years of significant inflation will see some recovery of the cumulative cost impact to the business," de Vos added. "I remain confident that the group continues to be well positioned to exploit the growth and margin opportunities in the remainder of this financial year and beyond."
Shares in McBride were 2.3% higher at 134.04 pence on Thursday.
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