11th Feb 2014 09:09
LONDON (Alliance News) - McBride PLC said Tuesday it expects its performance to improve in its second half performance, as it saw pretax profit decline in the half year ended December 31, 2013.
The household and personal-care products company posted a pretax profit of GBP3.7 million, down from GBP5.7 million in the previous year, hit by exceptional charges of GBP2.6 million in functional reorganisation costs and a GBP400,000 impairment charge as it moved its head office functions to Manchester.
Revenue rose slightly to GBP380.3 million from GBP378.2 million in the previous year. However, on a constant currency basis, revenue declined 3.0%, hit by lower contract manufacturing business and prolonged branded promotional activity in the UK.
McBride's customers include major supermarkets such as Tesco PLC, J Sainsbury PLC, Asda, and Aldi, among many others. It has a portfolio of its own brands too, including the Oven Pride and LimeLite cleaners and Surcare washing detergent. It has been shutting some of its contract manufacturing businesses so that it can focus on its private label business.
In the UK revenue declined to GBP132.8 million from GBP150.0 million, hurt by lower sales in the laundry sector due to promotional activity. In Western Europe revenue rose 8.8% to GBP214.3 million from GBP196.9 million, driven by strong growth in Germany, although markets continued to be impacted by weak consumer demand.
In the Rest of the World revenue rose 6.1% to GBP33.2 million from GBP31.3 million, driven by strong growth in Poland. McBride said that emerging markets are facing a slowdown in demand as the growth rate in the region slow. However, it is continuing to grow sales through new product launches and new business wins, it said.
McBride expressed confidence that it would see an improved second half as new products launched and cost savings initiatives take effect, but warned that how much it was able to improve depended on the extent of branded promotional activity and demand it saw in the UK's retail sector.
Meanwhile, McBride said Finance Director Richard Armitage will leave the company in order to pursue another career opportunity. Armitage will remain with the company until at least the end of the current financial year to ensure an orderly handover period.
Shares in McBride were trading down 0.2% at 104.75 pence Tuesday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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