In an interim management statement the group said business would continue to be “very challenging”, although it argued a recent restructuring of the business would enable it to produce good results “in these difficult times”.
The firm said that unseasonably wet weather during the summer and autumn, particularly in mainland Europe, has assisted in growing sales of silage stretchwrap some 5% this year, but at the expense of laying down stocks of the 2012 season.
BPI also said that polymer prices were easing, “with proposed increases announced monthly by our suppliers finally resulting in minor decreases in price, a process that is not conducive to credibility with customers”.
However such lower input costs, combined with what it called a “lower phasing of our capital expenditure” and cash from retained profits had cut the firm’s borrowings, which it now expects to be below previous expectations for the year.
Closure of Swansea factory
The company also outlined the background to the closure of its factory in Swansea, South Wales, announced earlier this month, with up to 49 jobs being lost.
It said the financial performance of the site had been “poor” for several years.
“Despite recent investment and a change in direction, disappointing volumes have resulted in escalating losses,” it added.
BPI said it was likely that volumes currently manufactured at Swansea would be transferred to other group sites within the UK.
The cost of the closure was anticipated at being around the £1.3m mark, according to the company.
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