21st Nov 2016 07:27
LONDON (Alliance News) - Plastic and fibre products company Essentra PLC on Monday issued a profit warning for 2016, hit by market softness in its pipe protection arm and slower-than-expected improvements in its packaging unit.
Essentra said business for its Pipe Protection Technologies unit remains subdued, though it said trading in its Component Solutions arm has remained in line with its expectations in the second half of 2016.
Health & Personal Care Packaging, meanwhile, suffered from issues at three sites in the UK and US in the first half. Improvements are taking longer than anticipated to flow through, Essentra said, creating challenges in growing this division in line with the company's expectations.
Filtration Products, which makes filters for cigarettes, has seen new contracts flow through, but the ramp-up on this work has been slower than expected. This division also faces slowness in the Chinese market, which has constrained profit and revenue, Essentra said.
As a result of all these issues, Essentra now expects to make an adjusted operating profit of GBP137.0 million to GBP142.0 million in 2016, down from its previous guidance of GBP155.0 million to GBP165.0 million previously.
In 2015, Essentra made pretax profit of GBP90.4 million.
By Sam Unsted; [email protected]; @SamUAtAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Essentra