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(Alliance News) - Essentra PLC on Friday posted a significant dive in earnings for the first half of 2020 due to the Covid-19 pandemic but reassured that revenue and order intake trends improved towards the end of the second quarter.
Shares in the FTSE 250 plastic and fibre products maker were trading 0.4% higher at 312.85 pence each on Friday morning in London.
For the six months ended June 30, Essentra posted pretax profit of GBP8 million, crashing down 85% year-on-year from GBP53.1 million. This was as revenue fell 12% to GBP448 million from GBP507 million.
However, the drop in profit was attributed primarily to the disposal of various businesses in the first half of 2019 as well as temporary inefficiencies caused by the pandemic, the company said. Costs in the first half of 2020 included GBP10.9 million of amortisation of intangible assets and an exceptional pretax charge of GBP2.5 million.
No interim dividend was declared, compared the 6.3 pence payout last year. The company said it will keep under review the possibility of a resumption of dividends for 2020.
Looking ahead, Essentra said: "On a divisional basis, the outlook for the second half suggests that Components will see a continuation in the improvement on like-for-like trends, Filters will see a continued trend of year-on-year growth driven in part by outsourcing contract volumes, and in Packaging - due to some recent softness seen in certain end markets owing to a supply chain adjustment resulting from a reduction in prescriptions and surgeries through lockdown periods - the third quarter should be broadly flat with a return to growth anticipated for the fourth quarter."
Cash held as at June end was GBP160.2 million.
Separately, the Milton Keynes-based company said it will target carbon neutrality by 2040 through a programme of energy efficiency improvements and emissions reductions across its manufacturing and other sites.
By Ife Taiwo; ifetaiwo@alliancenews.com
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