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Rexam: interim management statement

Rexam PLC, the global consumer packaging company, has issued its interim management statement for the period from 1 July 2012. According to Graham Chipchase, Rexam’s Chief Executive: “Despite a challenging trading environment, the Group’s overall performance is broadly in line with our expectations…”

Overall performance in Beverage Cans is in line with plans, with global volumes up 6% in the third quarter. Excluding Russia, European volumes increased at a slightly lower rate than in the first half as expected, while Russia returned to growth. In North America, the recovery of some of the standard can volumes lost in 2011 continued to drive performance, and growth in South America accelerated.
Performance in Healthcare is somewhat below expectations, principally as a result of lost business in the animal health part of the Pharma division.
Rexam announced the sale of its Personal Care business in July 2012 for USD 709 million, to be sold in two parts. The divestment of its High Barrier Food packaging business completed on 31 August 2012. The company has received the necessary regulatory approvals from the US, Europe and Brazil to complete the sale of the Cosmetics, Toiletries and Household Care business and is now awaiting approval from the Chinese authorities. Although the timing of this final clearance cannot be certain, Rexam is still targeting completion by the end of this year.
Rexam’s net debt at 30 September 2012 was GBP 1.2 billion; lower than at 30 June primarily due to the USD 250 million of proceeds from the sale of High Barrier Food. In the period, the company refinanced its 2013 maturities with USD 750 million of senior notes in the US private placement market due in 2022 and 2024, with most of the proceeds to be received by the year-end. As a result of this refinancing our effective interest cost will be around 4% from the second half of 2013.
Graham Chipchase, Rexam’s Chief Executive said: “Despite a challenging trading environment, the Group’s overall performance is broadly in line with our expectations. The divestment of Personal Care is in its final stages and we are on track to return GBP 370 million of the proceeds to shareholders. We continue to focus on generating cash, managing costs and improving return on capital employed, and our progress to date gives us confidence in achieving our 15% return on capital employed target by the end of 2013.”
A replay service of Rexam’s conference call held on Thursday 15 November will be available until 15 December 2012 as follows:
Dial-in number:
UK: +44 (0)20 3140 0698
UK Toll Free Number: 0800 368 1890
US Toll Free Number: +1 877 846 3918
Password     387307#

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