Declining raw material prices sustains Superfos

By Kirsty Barnes

- Last updated on GMT

Related tags Pharmaceutical drug Pharmacology

Superfos has reported positive third quarter results after a
troubled start to the year. The company attributes the turnaround
to declining raw material prices and growth in European business
sales.

The Danish packaging firm has also resolved delivery problems that plagued it last year during the expansion of its production capacity and the beginning of construction of a factory in the town of Lubien Kujawski in Poland.

The new factory aims to ride on the packaging wave that has seen the Eastern European markets grow by more than 25 per cent in 2003 and 2004.

"A double digit sales growth in the eastern part of Europe sustains the current construction of a new top modern factory in Poland,"​ said CEO Kim Andersen.

A positive development was seen in the company's turnover, which constituted €271.5 m, compared with €264.8 m in 2004.

However, >Superfos's​ earnings before interest, taxes, depreciation and amortisation (EBITDA) were €38.6 m, a decrease of €7.5 m from last year and EBITA was also down on last year, at €15.9 m compared to €24.3 m.

Compared to last year EBITA for the total business was not satisfactory, which primarily is attributable to the development in the first half year of 2005, when raw material prices were 30 per cent above the level of 2004, said the company.

"However, the non-recurring costs connected to closing Pharma's production facility in the UK have also placed a strain on the result,"​ said Andersen.

Earlier this year Superfos refocused its pharmaceuticals business with the closure of a UK plant that the company deemed was too small to operate efficiently.

The company has since been investing heavily in new pharmaceutical production facilities in its existing Haarby facility in Denmark, after suffering a period of restrained capacity that stopped it meeting demand for its products.

Superfos specialises in injection moulding, injection blow moulding and blow moulding processes for the pharmaceutical industry.

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