Abrdn Property Regulatory News (API)

28 Jul 2006 14:45

API Group PLC28 July 2006 28 July 2006 API GROUP PLC TRADING UPDATE Since the release of the Group's Interim Statement, trading conditions havecontinued to be mixed. While our global Foils business has performedsignificantly ahead of our expectations, the performance of the UK-basedLaminates business has continued to be disappointing due to challenging marketconditions and weak underlying demand. Consequently, we now expect the resultfor the year to be materially below current market expectations. The Foils business is performing well and operating profits are now expected tobe considerably ahead of previous expectations. Our US and Chinese businessesare growing sales strongly in their core domestic markets and exports from Chinainto new markets such as Russia and India are increasing rapidly. Bothbusinesses will report significant improvements in sales and profits over theprior year. While the European Foils business continues to experience pressureon sales and margins due to competition, demand for products launched earlier inthe year continues to grow and our efforts to expand the distributionorganisation in Continental Europe are yielding benefits. Our UK-basedHolographics business will show a healthy improvement over the previous year. In contrast, the Laminates business continues to perform poorly. Weak demand inrecent months has resulted in further significant sales shortfalls and we nowexpect the performance of the Laminates business to be considerably belowprevious expectations and to represent a very substantial deterioration on theprevious year. We have responded by downsizing the workforce, strengthening thesenior management team and taking action to improve productivity. The impact ofthese changes is likely to take some time to feed through into improved results. The Board remains committed to its successful strategy of growing and expandingthe Group's Foils business and is pleased with the improved performance achievedin this area. The Laminates business continues to be a market leader in itssector and we are optimistic that the actions referred to above will result inimproved performance in the short to medium term. Enquiries: API Group plc 01625 858700 David Walton, Chief Executive Financial Dynamics 020 7831 3113 Tim Spratt / Nicola Biles This information is provided by RNS The company news service from the London Stock Exchange