British Polythene harvests higher profit

Weak UK industrial and construction side dragged volumes down 2 per cent, and profits were lower in the UK & Ireland, too. Not so in mainland Europe where underlying operating profit surged 46 per cent to £13.4m. Strip out restructuring items and pension costs and group profit before tax grew 21 per cent to £19.1m.

Supplying farmers with crop covers and balewrapping films proved big business. True, this year's growing season is unlikely to last as long as it did in 2011, but BPI will benefit as depleted stocks are replenished. Over 35 per cent of sales are now into agricultural and horticultural markets, and increased capacity should mean this year is even better. Include sales into retail food, healthcare and waste firms, and resilient sectors account for almost three quarters of all revenue. Last year's trend of sharply higher raw material prices early in the year, falling later on, looks like being repeated in 2012, say management, so expect some short-term impact on margins.

Broker Investec expects a drop in adjusted pre-tax profit to £18.8m in 2012, giving adjusted EPS of 50.4p (from 46.9p in 2011).