Rpc Group Regulatory News (RPC)

18 July 2018

RPC Group Plc

AGM Trading Statement

RPC Group Plc ("RPC" or the "Group"), a leading international plastic products design and engineering company, announces a trading update to coincide with its Annual General Meeting, being held later today.

Q1 trading performance and outlook

Revenue from continuing operations for the quarter ended 30 June 2018 was £964.7m, representing 5.8% growth versus the first quarter last year, and benefitted from the contribution from Astrapak, polymer price tailwinds and organic growth of 2.0%.

Profitability (before and after adjusting items) from continuing operations was in line with management expectations and grew versus last year. Cash flow development (before and after adjusting items) was also in line with expectations and will continue to benefit from the returns on previous capital investments as the projects start to come on stream. 

Portfolio Management

Good progress has been made in disposing of the businesses identified as non-core which are anticipated to be accounted for as discontinued businesses, although the European Automotive business continues to endure cost inefficiencies associated with last year's launch.

The acquisition of Nordfolien GmBH, was completed in April and work has begun to realise cost synergies (without incurring any material adjusting items), primarily from procurement and best practice exchange.

Corporate Rating

The Group is pleased to announce that it has obtained an investment grade (Stable outlook) rating of BBB- from S&P Global Ratings. This is in addition to its existing investment grade rating of Baa3 (Stable outlook) from Moody's Investors Service.

Board

Martin Towers, who joined the Company in 2009 as an independent non-executive director, will step down from the board following the Annual General Meeting. The Board would like to thank him for his commitment and significant contribution to the success of the Company, including as Chairman of the Audit Committee and Senior Independent Director.

We look forward to welcoming Lynn Drummond, current Chair of the Remuneration Committee, as Senior Independent Director, subject to her re-election at the Annual General Meeting.

Commenting on the AGM trading update, Jamie Pike, RPC's Chairman, said:

"The Group has made further progress in the first quarter and I am pleased with the trading performance of the core businesses over the same period. RPC remains well placed to work with customers at the design stage and throughout the product lifecycle to drive a sustainable future for plastic. The Board strongly believes in the strengths and prospects of the Group.

However, pressure on the company's market valuation and differing investor views on the appropriate level of leverage is constraining the Group's ability to pursue some attractive opportunities for growth and your Board is working to resolve this. In the short-term, the Group will prioritise cash generation and the announced disposal of our non-core businesses, with a view to generating increased capital for deployment in the business or further returns to shareholders."

For further information:

About RPC Group:

RPC is a leading plastic products design and engineering company for packaging and selected non-packaging markets, with over 33 innovation centres and 191 operations in 34 countries, and employs c.25,000 people. The Group develops and manufactures a diverse range of products for a wide variety of customers, including many household names, and enjoys strong market positions in many of the end-markets it serves and the geographical areas in which it operates. It uses a wide range of polymer conversion technologies in both rigid and flexible plastics manufacture, and is now one of the largest plastic converters in Europe, combining the development of innovative packaging and technical solutions for its customers with good levels of service and support.

For further information please visit: www.rpc-group.com

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