McBride profit up despite raw materials price hike

City A.M. Reporter
McBride, Europe's biggest maker of retailer own-brand household and personal care goods, said it faced rising raw material costs and weak retail markets as it met forecasts with a 38 per cent rise in annual profit.

However the British-based group, which warned about a tough outlook in June, said it was better placed to cope with challenging conditions than in the past and that trading since its financial year-end was in line with its expectations.

It also said it had agreed to buy an initial 70 per cent interest in Dermacol, a privately owned, Czech-based manufacturer of skincare products for an expected £8m. It will buy the rest in 2017.

McBride, which is looking to expand into faster-growing emerging markets and higher-margin personal care products, said it made an adjusted operating profit of £50m in the year ended 30 June.

The full-year dividend was lifted 13 per cent to 6.8 pence a share, while net debt was cut by £22.4m to £60m.

Chief Executive Chris Bull said: "Although weak retail markets and raw material inflation will remain challenging in the short term, our balance sheet remains strong.

"McBride is better placed than previously to manage raw material cost inflation," he added.

McBride shares have lost 22 per cent of their value since the June warning on worsening trading conditions.