Cropper (J) Regulatory News (CRPR)

28 Jan 2008 13:28

Cropper(James) PLC28 January 2008 Issued by Citigate Dewe Rogerson Ltd, BirminghamDate: Monday, 28 January 2008 IMMEDIATE RELEASE James Cropper PLC Trading Update STATEMENT BY MR J A CROPPER, CHAIRMAN In the Preliminary Statement issued on 19 June 2007 I highlighted theexceptional nature of TFP's performance over the previous financial year and thechallenges faced in maintaining the momentum of profitable growth in the currentyear. Whilst turnover growth has met expectations over the course of the currentfinancial year, the impact of a changing product mix has diluted margin, whichcombined with the weakness of the US$ and the higher cost base resulting fromthe strategic acquisition of two new US subsidiaries earlier in the year, meansthat TFP's profit will be lower than last year. Turnover growth is expected toremain strong in both established and emerging markets. I referred in the Interim Statement issued on 21st November 2007 to the prospectof rising cost of pulp and natural gas dampening the profitability of JamesCropper Speciality Papers ("JCSP") in the second half year. Since that Statementthe cost of Northern Softwood Bleached Kraft, the market benchmark grade, hasrisen progressively to US$880/tonne. There is no sign that this upwardprogression will cease in the near-term. In December the cost of natural gasincreased sharply towards 60 pence per therm. Market forecasters currentlyproject that this price level will be sustained over the last quarter of thefinancial year. Thus if these market projections relating to pulp and naturalgas prove to be correct then JCSP's profit for the full financial year will bebelow that of the previous year. Management teams in each subsidiary are implementing actions to mitigate theimpact of the issues outlined above and to ensure that the businesses remain oncourse to deliver on their strategic plans. However in view of these factors itmust concluded that the Group's profit for the full financial year will besignificantly below current market expectations. Enquiries:Alun LewisChief Executive John Denman Fiona TooleyGroup Finance Director DirectorJames Cropper PLC Citigate Dewe RogersonTelephone: 01539 722002 Telephone: 0121 455 8370www.cropper.com Andrew KitchingmanManaging DirectorCorporate FinanceBrewin Dolphin Investment BankingTelephone: 0845 270 8613Mobile: 07785 708167 This information is provided by RNS The company news service from the London Stock Exchange