LONDON (Alliance News) - Plastic products company RPC Group PLC on Monday said revenue in its financial first quarter grew significantly thanks both to good organic growth and to acquisition contributions, while adjusted profit slightly outpaced the company's forecasts.
The FTSE 250-listed company said it saw good underlying organic growth in the first quarter to the end of June and said revenue was helped higher by the contribution from acquisitions it has made.
Adjusted operating profit for the year, in constant currencies, was ahead of RPC's expectations. This was thanks to the better sales volumes, the realisation of synergies from acquisitions, a reversal of the polymer price pressures seen a year earlier, and a better-than-anticipated contribution from Global Closure Systems, the French plastic closures and dispensing systems specialist it bought in December 2015.
RPC added its results benefited from the weakness in sterling against the euro and US dollar, as 75% of its revenue is generated from outside the UK.
"The group's overall performance in the quarter was encouraging with GCS performing ahead of expectations," said Pim Vervaat, RPC's chief executive.
Vervaat added the group's growth strategy will be further bolstered by the acquisition of British Polythene Industries PLC, the London-listed polythene films producer RPC agreed to buy for GBP261.0 million in June. Following clearance by the European Commission, that deal is expected to complete in early August, the company said.
"RPC is generally well placed to operate in periods of macro-economic uncertainty, including that which may be caused by the outcome of the UK referendum on the EU, as it has robust market positions in relatively defensive end-markets, particularly in the UK," the CEO added.
"The weakening of sterling enhances the competitiveness of the UK operations due to the higher cost of imports from mainland Europe, and the group's position as a modest net exporter from the UK may incrementally benefit its performance," Vervaat said.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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