29th Jul 2016 07:09
LONDON (Alliance News) - Essentra PLC shares plummeted on Friday after it said revenue and profit both dipped slightly during the first half of 2016 and guided that both will be lower over the course of the full year.
Essentra shares were down 15% to 532.20 pence per share on Thursday morning.
The supplier of specialist plastic and fibre products said pretax profit edged downward during the first half to GBP42.6 million from GBP45.1 million last year, in line with the minor fall in revenue to GBP545.2 million from GBP550.4 million.
Profit fell at a slightly steeper rate in the period, declining 5.5% year-on-year, than revenue, which was down 4.6%. Notably, Essentra said revenue was down 7.0% in the period on a like-for-like basis.
The pretax profit before exceptional items totalled GBP63.0 million compared to GBP77.0 million last year, a 21% fall.
The company will pay a flat dividend for the half of 6.3 pence per share.
""As reported in our trading update of 9th June 2016, Essentra has experienced a number of challenges - notably in the Filter Products and Health & Personal Care business - which have impacted our interim results," said Chief Executive Colin Day.
"Notwithstanding these challenges, however, the company remains fundamentally strong, with global leading market positions in end-markets with positive growth characteristics, and attractive levels of profitability and cash generation," he added.
Day said he was confident that the company would have a better second half and said it would aim to deliver a "mid single-digit decline" in like-for-like revenue and adjusted operating profit of GBP155.0 to GBP165.0 million.
Adjusted operating profit in the first half amounted to GBP70.0 million compared to GBP82.0 million last year. That means Essentra will need at least an 11% rise in adjusted operating profit in the second half to hit the lower end of that range and an 18% rise to hit the top end.
Still, the adjusted operating profit looks set to be lower than the GBP171.5 million reported in 2015.
By Joshua Warner; [email protected]; @JoshAlliance
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