API Group profit soars

Shares of specialist foils and packaging materials group API shot ahead as it unveiled a massive rise in annual profit and said it is confident of further progress for the remainder of 2012.

Pre-tax profit jumped by 77% to £5.1m for the year ended 31 March 2012 while revenues grew 14% to £113.9m. Operating profits for the period advanced by 32% to £6.9m.

Chairman Richard Wright said was pleased with the results, in spite of the challenging economic conditions and pressures from higher raw material costs.

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"A second year of strong cash flow has transformed the Group's balance sheet. With a robust pipeline of growth projects and management focus on improving the profitability of the European foils business, the Board is confident of making further progress in the current financial year," he said.

Laminates remained the biggest contributor to the full year results. Holographics performed particularly well following growth in target security markets. Foils Americas benefited from an improved sales mix and lower costs.

Foils Europe profits fell £0.5m as recovering margins were offset by weaker volumes, especially in the second half. API expects results to benefit from the increased focus brought by the recent establishment of separate management teams for Foils Europe and Holographics, the group explained.

As the group looks ahead, it added: "The Board remains cautiously optimistic about prospects for the new financial year. The general economic climate and uncertainty surrounding the euro continues to impact consumer confidence and economic growth in the regions and markets served by API. However, end markets for premium products which drive a significant proportion of sales have so far proved relatively resilient."

No dividend payment has been recommended.

CJ