(Alliance News) - James Cropper PLC on Wednesday said it expects profit for financial 2024 to fall short of expectations after facing delays in the final months of the year, with its top-line also expected to face pressure.
Shares in James Cropper plunged 33% to 534.00 pence each in London on Wednesday morning.
The Cumbria, England-based paper, packaging and advanced materials manufacturer's said it expects adjusted pretax profit to be "materially below" expectations in the financial year that ends April 1. In financial 2023, adjusted pretax profit was GBP3.2 million.
In addition, revenue for the financial year is expected to be no less than GBP103 million, down from GBP129.7 million the year prior.
The manufacturer explained that it faced "trading challenges" in November and December in its Paper and Packaging divisions.
Looking ahead, James Cropper said its Advanced Materials business has had expected projects in hydrogen delayed due to inflation and higher interest rates feeding through, as well as increased project costs.
This has resulted in customer expansion plans being pushed back to as far as 2028, which will impact the company's revenue trajectory for the rest of 2024. James Cropper also expects a slower ramp-up in demand than previously anticipated across 2024 and 2025.
However, the company affirmed that its project pipeline remains strong and in the meantime, it will aim to "keep efficiency high through tactical use of free capacity". It also added that the final quarter of the year is expected to show "some recovery in volumes" in Paper & Packaging, and demand is expected to further recover through financial 2025.
Chief Executive Officer Steve Adams said: "The pressure on volume from inflation and global uncertainty has, regrettably, resulted in us revising our profit expectations, despite us continuing to have a strong future growth plan in place.
"Overall, despite the setback in profitability, we remain steadfast in focusing on our strategy for accelerated growth and the board is confident that the growth prospects of the Group as a whole remain significant in the coming years."
By Sabrina Penty, Alliance News reporter
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Cropper (J) (CRPR)