Fiberweb has continued to deliver improved trading in the second half of the year and continues to make good progress towards achieving its medium term target margins. Profits for the full year are expected to slightly exceed market expectations, with like for like sales about 10% ahead of the prior year. This will mark a seventh consecutive six-month period of improved performance.
The strongest trading performance has been in the Industrial business with good performance in filtration despite U.S. construction markets remaining weak throughout the year. Trading volumes in the company’s wholly-owned hygiene businesses are slightly ahead of the prior year on a like for like basis.
Raw material prices have largely stabilized in the second half and hedging programs have continued to be successful. Hygiene margins in the second half have benefited from the passthrough effect of the higher raw material prices seen in the first half, while margins overall have continued to benefit from successful cost reduction and investment actions, hedging activity and improved product mix.
Cashflow has continued to be strong, financing important investment projects in Europe and North America to deliver innovation, further cost reduction and volume growth. Net debt is anticipated to be in line with market expectations.
Fiberweb also reported completion on January 6, 2011 of the Boddingtons acquisition announced in December. This bolt-on acquisition in the strategically important specialty construction market complements Fiberweb’s Terram and Typar geotextile businesses and is expected to be earnings accretive in the year ending December 31, 2011.