James Cropper PLC on Thursday celebrated a ‘strong recovery’ in its latest financial year as revenue surged, despite increased costs cutting profit in half.
The Cumbria, England-based paper, packaging and advanced materials manufacturer said pretax profit fell 53% in the year that ended April 1 to £1.3 million from £2.8 million the year before.
James Cropper attributed this to net finance costs and exceptional costs, which more than doubled to £1.2 million from £540,000 and to £986,000 from £354,000, respectively.
Earnings per share decreased 62% to 5.4 pence from 14.2p.
Adjusted operating profit, however, increased 4.0% to £4.8 million from £4.6 million, despite ‘significant inflationary cost headwinds’.
James Cropper celebrated its ‘strong recovery in a transformational year,’ as high demand and retained contracts drove revenue up 24% to £129.7 million from £104.9 million in financial 2022. Chair Mark Cropper said this was ‘in spite of unprecedented market headwinds’.
He continued: ‘Significant progress was made in repositioning James Cropper to capitalise on growth opportunities within its core and emerging end-markets, such as the fast-growing renewable energy and decarbonisation markets which are in need of novel high-performance materials and sustainable fibres.’
James Cropper declared a 4.0p per share final dividend, down 47% from 7.5p the year before but ‘in line with expectations’. This brought its full-year dividend to 6.0p per share, down 40% from 10.0p.
James Cropper said that following the end of the year it had made ‘the hard choice to restructure our Paper division...with associated headcount reductions.’ Mark Cropper said this decision ‘was not taken lightly but has been essential to address years of headwinds and margin pressures and create a more resilient, profitable business.’
Looking ahead, James Cropper expects its Future Energy and Luxury Packaging sectors to deliver high market growth and value, and a ‘streamlined’ paper products offer to drive margin improvements and increased productivity.
The chair added: ‘We will aim to drive increased value for our shareholders through accelerated growth in each of our market focused segments; Creative Papers, Luxury Packaging, Technical Fibres and Future Energy by leveraging our potential as one company under the James Cropper name.
‘I am excited by the many opportunities and have confidence in our strategy...The foundations are in place to create a greater global presence for James Cropper, by repositioning ourselves to better serve our existing and target customers.’
Shares in James Cropper were down 1.0% at 712.60p in London on Thursday.
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