Rexam trading in line during third quarter

14th Nov 2013 07:12

- Third-quarter trading in line with expectations- Full-year expected to show improvement over 2012 - Plans to divest the healthcare business on trackFTSE 100-listed consumer packaging company Rexam said trading since the start of July has been in line with company expectations and it remains confident of posting improved full-year results over 2012. The group, which issued a profit warning at the end of June, said overall global volumes in Beverage Cans were rose 3% in the third quarter as improved growth in Western Europe was partially offset by weakness in Russia and a difficult trading environment in Egypt and Turkey.Rexam, which sells packaging products to soft drink giant Pepsico and Coca-Cola, said contractual gains fuelled a strong performance in North America, however North American volumes are still below previous peaks.In South America, good growth in specialty cans was offset by continued weakness in standard cans."We are rapidly adapting our manufacturing footprint to meet this changing market dynamic," Rexam said. The group, which is looking to offload its Healthcare operation to be a focused beverage cans business, said the process to divest the business is progressing according to plan.Looking into next year, while it expects some volume growth, it expects to contend with the difficult macroeconomic backdrop in Europe, as well as the impact of a maturing specialty can market in North America and foreign exchange translation headwinds. Better summer weather helped trading Western Europe while North America trading remained strong. Rexam's Chief Executive Graham Chipchase said: "We will continue with our strategy of optimising cash, managing costs and driving return on capital employed. "Our Return on Capital Employed (ROCE) target remains 15%, and we are committed to maintaining returns around that level as we take advantage of the opportunities to grow the business."Rexam said its financial position was unchanged from that at June 30th 2013.CJ