Rexam, the global consumer packaging company, today issues an update on half year trading and announces that it has initiated a process to sell its Healthcare business.
Update on trading
As previously indicated in our April IMS, beverage can volume growth began the year more slowly than planned. The summer season traditionally influences our results, but while North America has continued to perform strongly, volumes have been disappointing in South America and Western Europe in the last two months. For the five months to the end of May global volumes grew by 1% versus last year and as a result, despite an increased focus on cost management, our operating performance in the first half of the year will be slightly below that of last year.
Whilst we have accelerated our cost mitigation measures, we now expect full year performance to be modestly lower than previously anticipated. Volumes have seen some improvement in Brazil in June, as we regain market share, and the second half should benefit from increased cost reductions and certain contractual price/volume arrangements in Europe.
Sale of Healthcare
In line with our long term strategy to focus on beverage cans and maximise shareholder value, the Board has initiated the process to sell the Healthcare business. In addition, we are making encouraging progress in pursuing beverage can investment opportunities in higher growth markets.
Graham Chipchase, Rexam's Chief Executive said: “It has been a challenging first half, but we have taken assertive action on costs to mitigate the impact on our performance and maintain our capital discipline. Although we are still in the midst of our seasonally important summer period, we are managing the business proactively to overcome these challenges, and we continue to expect full year performance to show improvement over 2012, even if progress is likely to be less than previously anticipated. Following the proposed sale of Healthcare, Rexam will be a focused beverage cans business with a strong balance sheet and a clear strategy to maximise long term shareholder value.”
Rexam will host a conference call for investors and analysts on Tuesday 25 June at 8am (UK time).
Participants dial-in number:
UK: + 44 (0)20 3139 4830
US: +1 718 873 9077
UK Toll Free: +44 (0)20 3426 2807
US Toll Free: +1 866 535 8030
Sandra Moura, Head of Investor Relations, Rexam +44 20 7227 4100
Jonathan Thornton, Head of Communications, Rexam +44 20 7227 4100
Katharine Wynne, Tulchan Communications +44 20 7353 4200
Martin Robinson, Tulchan Communications +44 20 7353 4200