The headline earnings per share fell from 144 cents in the same comparable period in 2013 to 126 cents in 2014.
(READ MORE: Transpaco produces revenue growth)
“Total operating profit decreased 12 per cent to 56.8 million rand from 64.6 million rand in 2013 on turnover of 716.2 million rand, up 7.3 per cent from 667.6 million rand in 2013,” said the company.
“Operating profit in the paper and board division increased against a reduction in the Plastic division.”
The leading manufacturer, recycler and distributor of plastic and paper packaging products said, notwithstanding a still challenging economic environment, the directors are satisfied with Transpaco’s performance.
“The group’s margins remained under pressure as raw material prices continued to increase during the period, driven by the weakening exchange rate and high international pricing,” said the group through a SENS announcement.
“Controlled expenses and higher volumes helped to mitigate the impact on the group’s performance.”
[DATA TPC:Transpaco Limited] said plastic raw material prices will soften during the following six-month period.
“Several additional factors outside of the control of management adversely affected the group in the period, most notably the national plastic industry strike during July and August 2014,” added the company.
The group also said, as a result of the strike, operating profits reduced by around 10 million rand mainly in the Plastic Division.
“The national rolling power outages are a further factor affecting the efficiencies of all Transpaco factories, resulting in additional costs,” said the group.
(READ MORE: Transpaco hits R1.25 billion turnover)
“When comparing this period directly to the same period last year, cognisance must be taken of the change in the Department of Trade and Industry (DTI) programmes in which the group has participated.”
Previously the grants were released in stages and accounted for as such.
“With the new DTI grants a once-off amount is received and amortised over the depreciated life of the related asset,” added the company.
“During the previous period Transpaco accounted for 1.5 million rand worth of DTI grants, compared to 252 000 rand for the period under review.”