Promens recovers despite soaring material prices

European plastics processor Promens recovered strongly last year, delivering significantly improved operating earnings to match those achieved before the 2009 global financial crisis.

The Icelandic packaging to rotational moulding group reported a 17% increase in Ebitda to €57.5m in 2011 on annual sales up 11% to €612m from its continuing operations.
Promens’s three operating divisions covering packaging, industrial component moulding and roto moulding bettered their earnings in comparison with those of 2010. The dominant packaging division continued its strong performance of the past five years generating an improved 7.5% return on €406m annual sales.

The firm’s roto moulding division, which had been impacted hard by the economic crisis achieved returned 5% earnings on sales of €98m, with a particularly strong performance for its two Icelandic material handling products plants in Dalvik and Hafnarfjordur.
Promens’s components moulding division, which had suffered badly in 2009 due to its dependence on the cyclical automotive truck market segment, afnarfjordurHshowed partial recovery with a 3% return on €107m annual sales.

However, Promens reported the division’s biggest plant at Zevenaar in the Netherlands faced “operational issues” last year due to a surge in demand for a greater volume of parts after the facility was significantly restructured in 2009. The problem was gradually resolved during the year but the final result does not reflect the volume growth, the firm explained.
Promens Zevenaar operates 36 component injection moulding machines from 40 to 2, 700 tonnes clamping force in a 14, 399m2 production hall.

Referring to the overall company performance, Promens pointed out that it should be viewed in the context of “the double-digit year-on-year average increase in raw material prices”.

Promens revealed that its French passenger car parts operations, which it recently sold off to the US industrial turnaround specialist American Industrial Acquisition Corporation (AIAC), lost €3.7 million during 2011. The four plants saw combined revenues for 2011 of €36 million, it reported.

“Given the uncertainty in the economic outlook in the Eurozone and rising polymer prices in the first quarter, we are cautiously optimistic for the year 2012, ” stated Jakob Sigurdsson, Promens’s president and CEO in the results report.