At its annual general meeting this week, Fiberweb reported that trading conditions so far this year have been mixed. Strong demand for U.S. housewrap, hygiene and dryer sheet products have been offset by softer volumes elsewhere, most notably in the construction markets outside the U.S. Operating profit and margin are ahead of prior year, despite lower sales, while the net cash position is stable. For the full year, underlying earnings per share are expected to remain in-line with the board’s expectations, says chairman Malcolm Coster.
Within Technical Fabrics, while sales in key filtration and technical specialties markets have been slow, the group remains focused on targeted growth in these areas. Geosynthetics has seen growth in the U.S., tempered by weaker markets in Canada and Europe.
However, the outlook for the division is more positive with significant growth expected in UK from both existing and innovative products.
Investment in the group’s expansion of its flagship facility in Old Hickory, TN, enabling consolidation of operations onto one site, is progressing well. This company now expects to accelerate this investment, raising its total 2013 capital expenditure by £3 million. This will be compensated by lower spending in 2014 and the £1.6 million anticipated annual savings from the project should start in the fourth quarter of 2014, rather than the second half of 2015.
While the anticipated growth in operating profit may be somewhat constrained by weak markets, the group continues to expect margin improvement and underlying earnings per share to remain in-line, supported by positive developments in interest and tax.