SHARES in British Polythene Industries (BPI) lost 16p to close at 497.5p yesterday after chairman Cameron McLatchie told the annual meeting that the company would ''find it difficult to improve on last year's first-half results'' in spite of the fall in the pound.
McLatchie said the recent weakening of sterling would not help reduce raw material prices, although it would ''in the medium term restore our competitiveness''.
BPI in March reported a 17% fall in pre-tax profits on a 10% rise in turnover.
McLatchie said: ''The challenging trading conditions which we experienced last year have continued through the first four months of 1998 and have shown few signs of changing.''
He said the flexibles division was coming to terms with the loss of its major customer. ''We have been unsuccessful in finding a buyer for the production facility most affected by this decision, and a rationalisation of our production facilities is now inevitable to enable this division to deliver value.''
McLatchie said the strength of sterling continued to encourage imports and depress export margins. ''Despite this, many of our polythene film businesses continue to trade satisfactorily, with reduced volumes being compensated for by a return to more normal margins on the back of an eroding raw material price.''
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