Nuplex restructures business, downgrades profit forecast

Thursday 12th May 2011

Nuplex Industries shares fell 10c to $3.06 after the company today downgraded its earnings forecast and restructured its senior management team.

The chemical and resins company said its earnings before interest, tax, depreciation and amortisation in the range of $125 million to $129 million in the 12 months to June 30, which is $2 million to $6 million lower than previously forecast.

The profit is after a one-off restructuring charge of $4 million for restructuring the business.

Net profit after tax is expected to be between $62 million and $65 million.

The company also said each of its four regions will have a regional president who will report directly to chief executive Emery Severin. Sam Bastounas will move from his role as chief operating officer functional materials and specialties into the role of regional president, Australasia.

Demand conditions for the Australian based composites business has been much weaker than anticipated due to wet weather, continued consumer spending restraint, increased import competition from a stronger Australian dollar and fewer infrastructure projects.

"We are extremely focused on recovering rising raw material costs which for some key inputs have increased by approximately 25% over this financial year. Across the group, higher selling prices have been implemented," Severin said.

NZPA

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