Paper maker reports ‘excellent start to year’ in first quarter update
James Cropper, the Kendal advanced materials and paper products group, said it has made an “excellent start to the year” in a first quarter trading update this morning (July 27), coinciding with its annual general meeting being held in Kendal.
It said sales in the first three months have improved by 36% on the previous year.
While demand across all three divisions is ahead of the prior year quarter, TFP has started the year with very strong sales and has seen particularly high demand across TFP Hydrogen.
TFP, or technical fibre products, develops technical non-wovens for a wide variety of challenging applications in the aerospace, fuel cell, composite and automotive industries.
The paper division has secured new luxury packaging contracts and Colourform has also continued to win new contracts across the premium wine, spirits, and beauty markets.
Profits for the group are currently tracking ahead of plan and significantly ahead of the prior-year quarter, with management expectations for fiscal year 2023 presently unchanged. The paper division has started the year profitably, however, it is the TFP division that is delivering the majority of the benefit to the group, it said.
The paper division is extending its embossing and varnishing capacity in the third quarter of the current financial year, providing additional capability to meet demand in the luxury packaging market.
Coating capacity for TFP Hydrogen will be extended with an additional line operational in the USA by the end of the second quarter.
Chairman, Mark Cropper, said: “We are pleased to report an excellent start to the financial year, with every division within the group outperforming the same period last year.
“TFP has made a very strong start to the year which has positively impacted profits. With the new hydrogen coating line on schedule to be operational by the end of Q2, the division is on track to deliver another record year.”
He added: “The paper division, which was impacted by the unprecedented high energy costs in Q4 last year, traded profitably in Q1, demonstrating the pricing changes implemented are working together with the strategy to improve the division’s portfolio.
“While we are always mindful of the energy and raw material headwinds, the strong start to the year and new embossing and varnishing capacity, which is on track to be completed and commissioned in H2, will support our ability to meet the growing demand and continue with this pleasing progress.”
He said the Colourform division continues to maintain a strong pipeline of sales and the division’s eye-catching and eco-friendly packaging designs have received further international accolades, the latest of which is the European Dieline design award.
“With the market returning to more normalised growth conditions, the group’s prospects remain very attractive and we look forward to making further progress in the year ahead,” he said.
