06 May 2010 10:11 [Source: ICIS news]
LONDON (ICIS news)--Rexam’s first-quarter results were ahead of expectations due to higher volumes in beverage cans and the company is confident of an improved performance in 2010, it said on Thursday.
Rexam said a completed cost-reduction programme in beverage cans would cut costs year on year by about £19m (€16.2m, $20.8m) in 2010.
As expected, the plastic packaging division was showing some recovery, although bottle closures continued to decline due to weak demand for carbonated soft drink and bottled water, it added.
Cost-reduction initiatives to close and consolidate eight plants and reduce the workforce by 10% were on track to deliver the expected £24m year-on-year savings in 2010, Rexam said.
The company’s net debt of nearly £2bn at March 2010 was higher than that reported in December 2009, mainly due to normal seasonal inventory build and £100m of foreign exchange translation movements, it said.
Rexam said its committed bank facilities maturing in 2011 and 2012 have been refinanced for five years to 2015 at better rates than its existing facilities.
The company’s CEO, Graham Chipchase, described the company’s first quarter as “encouraging”, adding: “The execution of our cost-reduction initiatives and our continued focus on cash generation gives us confidence of improved performance in 2010."
(£1 = €0.85, $1 = €0.78)
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