Nuplex shares up after company posts profit 

Source: ONE NewsNuplex CEO John Hirst

The share price of resin maker Nuplex rose 24 cents on Thursday after the company posted a profit of $16.7 million.

Nuplex Industries reported a 65.4% fall in full year net profit to $16.7 million as tough economic conditions battered the company.

Revenue for the 12 months to the end of June fell 2.5% to $1.49 billion.

Managing director John Hirst said the 2008/09 financial year was without doubt the most testing in the long history of Nuplex, which makes and distributes resins, and other specialty products.

"After a strong start we suffered a number of major setbacks," he said on Thursday.

"First, rises in raw material costs in the early part of the year inhibited margins; then the collapse in European business in the second quarter culminated in a 30% reduction in demand over the prior year.

"The recession continued in the USA and New Zealand and business conditions there, which were already poor, deteriorated. In Australia, products exposed to discretionary spending were hit hard and, while Asia had a number of high spots, the lack of global demand for exports such as furniture took its toll."

During the financial year Nuplex also had to raise nearly $160 million in new capital to meet debt commitments, following a fall in first half sales.

Hirst said trading conditions now were best described as stable, with general optimism that the worst downstream impacts of the global financial crisis had passed.

The company also announced that it is paying a special dividend of 3.5 cents on top of its annual 5 cent dividend.

The company says the special dividend reflects confidence in the company's future and a strong balance sheet.