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Pilkington expects harder times in second half

Pilkington, the UK glassmaker, cautioned that it expected to face tougher trading conditions in the second half after reporting a 29% rise in first-half pre-tax profits.
Paolo Scaroni, chief executiv…

Pilkington, the UK glassmaker, cautioned that it expected to face tougher trading conditions in the second half after reporting a 29% rise in first-half pre-tax profits. Paolo Scaroni, chief executive, said it was difficult to determine the outlook given the current softening of markets. The company has reported weaker demand for glass both in the US and Asia and some signs of softening in its European markets. Vehicle production in its main markets of Europe and North America, which declined in the first half, is expected to decrease further in the second six months. Pilkington has so far responded by cutting production at some of its float glass plants in an attempt to avoid possible overcapacity in the market, which would damage pricing. The company has also delayed building a float glass factory in Poland. But Scaroni said the company was not anticipating further job cuts. In the past four years Pilkington has shed 12,000 jobs worldwide. Scaroni said Pilkington was now ready to start sales of ActivO, its self-cleaning glass, in central Europe from December, with the roll-out for the rest of the world in 2002. “We expect it to make a contribution to the bottom line in 2002-03 with sales of 3 million sq.ft., which will hopefully rise to 8 million sq.ft. in three years,” he said. The company lifted profits from GBP 79 million to GBP 102 million in the six months to 30 September as turnover rose 8% to GBP 1.47 billion. Scaroni said the company had met all of its internal targets in the period.

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