RPC passes on higher plastics prices

24th Mar 2011 13:06

Higher selling prices and increased volumes at plastic packaging supplier RPC mean that revenues in the 2010/11 financial year will be well ahead of last year.The group said that it was able to pass through rising polymer prices to customers and saw significant growth in the higher added value sectors of pharmaceutical, personal care, long shelf-life and coffee capsules.However, a time lag on passing on these increases has had a significant negative impact on full year margins. "The group is confident in its capability to pass through both the most recent and any future polymer price increases," the statement said.While polymer prices have surged by 20% since January and reached record levels, operating profit and adjusted pre-tax profit should still exceed management's expectations.Last month, RPC acquired European injection moulded plastic packaging firm Superfos Industries for €240m, and expects the cost and revenue synergy potential of the enlarged group to be around £5m in 2011/12, and in the range of £15-25m per annum from the third full year after the acquisition. "It is very pleasing to see that the overall performance of the Group has improved and is ahead of our expectations despite the headwind we have faced this financial year in terms of rising polymer prices," said chief executive officer Ron Marsh.