Investors buy on modest Nuplex result

Investors liked Nuplex's annual result yesterday, pushing the resins company's share price up 11c to $4.56 on its $0.8 million rise in net profit to $29.2 million.

The modest result was despite a $279.5 million or 42 per cent leap in revenue to $937.3 million, thanks to a boost from its new Coatings Resins business in Holland.

Chairman Fred Holland said the result was in line with forecasts, "but reflects a disappointing second half arising from the softening of parts of its key Australian, Asian and European markets and a rapid rise in petrochemical raw material costs".

Nuplex is Australasia's largest producer of resins - synthetic compounds used in paints, printing inks, adhesives and fibreglass.

The company had a first half profit of $16.2 million and, in February, issued a profit warning, saying it was seeing signs of a softening in demand for coatings resins in New Zealand and Australia, which accounts for 40 per cent of sales.

Holland anticipated continuing flat business conditions in Australasia, with some recovery in Asia and market conditions in Europe and the US to continue for the mid-term.

A final dividend of 14.5c will be paid on October 14.

- Georgina Bond, NZPA