Shares in rigid plastic packaging manufacturer RPC (RPC) slumped 10 per cent as it said full-year numbers would miss market expectations after it experienced a tough final quarter caused by rising polymer prices and weak trading.
There was little cheer in the outlook, either, as management said flat economic growth forecasts in Europe would translate into limited organic growth for RPC. This led broker Panmure Gordon to cut current-year forecasts for adjusted pre-tax profits from £83.5m to £77m, giving EPS of 34.9p. It also cut 2014 forecasts from £90.1m to £79.0m, giving EPS of 35.8p. At 400p the shares are now valued at 11 times this year's forecats.
Sales are still rotating into higher-margin coffee capsule products, but not quickly enough to have offset the impact of the weak euro in the financial year to the end of March, which cost the company £4m. And higher resin prices are estimated to have push cost up an extra £2m.