Devro reports volume and revenue growth
Casings supplier Devro has unveiled increased revenue of 7% with strong growth in most of the regions it operates for the year ended 31st December.
Along with its return to volume growth with revenue at £256.9 million, from £241.1 million in 2016, the company has also enjoyed significant cost savings and favourable exchange rates, up 4%.
Operating profit was £33 million, from £15.4 million in 2016, with the improvement “mainly due to lower exceptional items in 2017”, following the completion of new plants in China and USA.
In addition, volume growth was strongest in China, south east Asia and Russia, while it also reported strong growth in the second half of the year in Europe.
Underlying earnings before interest, taxes, depreciation, and amortisation was also ahead of 2016 by 9%, with volume growth, cost savings and exchange rate benefits having been partially offset by price/mix and full costs for new plants started up in 2016.
Peter Page, chief executive of Devro, commented: “Our priorities at the start of 2017 included sales growth to regain market share and cost reduction in operations. We made strong progress on both objectives, with 8% growth in sales volumes of edible collagen casings and a £7 million reduction in the manufacturing cost base, supporting a significant reduction in net debt.
“Growth in demand will continue as the global population increases, consumer spending progresses and tastes become more varied. The business is well positioned for the future.”
In 2018, Devro will focus on “maintaining the momentum of the Devro 100 programme”, which was unveiled a year ago and underpins a three-part strategy, while the total forecast benefits, associated exceptional costs and capital expenditure over the three-year period remain unchanged.
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