LONDON (Alliance News) - British Polythene Industries PLC said Friday it expects its full-year performance to be in line with current market expectations, despite volatile raw material prices and challenging conditions in the third quarter.
British Polythene produces packaging and film including the plastic wraps used to contain livestock fodder called silage. SIales of silage stretch-wrap were lower over the last few months, the company said, as the growing season for farmers had been shortened by a cold spring and early autumn.
Polymer suppliers had imposed price increases in July and August, and further increases in September. As a result the average polymer price was at an all-time high, British Polythene said. Although this high price did see a small reduction in October, it compressed profit margins during the quarter, as the higher prices were passed through to customers.
The company is holding out for a more "realistic" price for polymer as lower cost raw materials were becoming more available to polymer producers due to hydraulic fracturing.
Shares in British Polythene Industries were trading down 1.9% at 701.50 pence.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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