Coral Products PLC on Thursday said subsidiary Tatra Rotalac Ltd has signed an exclusive three-year supply deal with an unnamed ‘leading’ UK distributor.
Shares in Coral Products were up 10% at 6.34 pence in London on Thursday afternoon. The stock remains down 42% over the past year, however.
The Manchester, England-based maker of bespoke plastic products said the agreement with a distributor of British Retail Consortium packaging containers was for the supply of ice cream and food containers, and is expected to generate sales between £1.5 million and £2.0 million a year.
Coral’s ability to manufacture the products follow its £2.1 million investment in new machinery and re-tooling in September, which have now become operational following a twelve-month delay.
The firm said on Thursday it has now completed the successful commissioning of its in-house manufacturing capability for the volume manufacturing of Ecodeck floor grids. The new facilities ‘allow the company to optimise the use of recycled materials, enhancing manufacturing efficiency’.
The facilities will also allow Coral to insource £3 million per year of previously outsourced products, which is expected to have a ‘material positive effect on overall margin contribution and cash flow’.
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