Scapa profits take a hit from loss of ConvaTec contract

9th Oct 2019 08:28

(Sharecast News) - Tapes and adhesives manufacturer Scapa expects interim profits to be impacted by the loss of its contract with ConvaTec but said revenues still looked set to grow on the back of a strong performance in its healthcare unit.
Scapa said on Wednesday that trading in the six months ended 30 September had been in line with expectations, with revenues up 14.3% year-on-year, or 10.4% on a constant currency basis.

The AIM-listed group's healthcare unit reported a 23% increase in revenues despite the loss of ConvaTec volumes. However, Scapa expected its profits to be around 17% lower year-on-year as a result of the lost contract with the FTSE 250 medical products firm.

Scapa anticipated that the second half would see it benefit from a strong pipeline of new products and technology transfers from both new and existing customers.

The group's industrial unit saw revenues increase by 3.9% despite strong market headwinds.

While Scapa expects market-wide challenges to continue, the firm considers itself to "well-positioned" to make further progress against its strategic, operational and financial objectives and remains confident in its outlook.

As of 1115 BST, Scapa shares were down 0.74% at 215p.