LONDON (Alliance News) - British Polythene Industries PLC on Wednesday said it is confident it will meet expectations for the full year, despite a fall in volumes, but said it may have to make up to 90 redundancies as it restructures some of its production facilities.
The polythene products manufacturer said reductions in the price of polymer together with lower demand from certain sectors meant that volumes to the end of October were below the comparative period, although the shortfall in demand was offset by margin recovery during September and October.
"We are now seeing order books firming again, and polymer producers seeking price increases for November, but it remains to be seen how successful they will be," the company said in a statement.
British Polythene added that recent capital expenditure at Zele in Belgium and Leominster in the UK, its two largest facilities for the production of blown stretch-films, means it is closing its smaller facility at Widnes, UK. It said this will reduce costs and offer customers higher quality products. This will result in around 50 redundancies, although British Polythene said some personnel may transfer to other group sites.
It also plans to reduce numbers at VMB, its consumer facility at Worcester, and in the films business at Sevenoaks, in order to align staffing levels against current demand at those locations, which may result in a further 40 redundancies.
British Polythene added that the disposal of its loss-making Promopack Digital Studio business will result in an exceptional charge of GBP1 million for the full year.
"Overall the board remains confident that our business is on course to meet our expectations for the year as a whole," the company said.
Shares in British Polythene were trading down 1.8% at 724.20 pence Wednesday morning.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
Copyright 2015 Alliance News Limited. All Rights Reserved.
