Envelope manufacturer Bong has said the market in Europe fell by 8% in the first half of 2016, leading to further volume and price pressures.

In its interim report, Bong said the rate of decline was expected to continue in the second half of the year, meaning that significant overcapacity would remain.

Envelope manufacturer Bong has said the market in Europe fell by 8% in the first half of 2016, leading to further volume and price pressures.

In its interim report, Bong said the rate of decline was expected to continue in the second half of the year, meaning that significant overcapacity would remain.

These market forces are leading to lower prices as well as volumes, and the Sweden-based group reported H1 sales of SEK1.07 billion ($125 million), a currency-adjusted decline of about 6.8%

Reported H1 operating profit of SEK4 million was an improvement on the SEK9 million loss recorded in 2015, but adjusted operating profit actually fell by 60%, from SEK15 million to SEK4 million, as gross profit dropped.

One bright spot in the second quarter was the light packaging segment which saw currency-adjusted sales increase more than 10% year on year. This was due to investments in paper carrier bag machines following EU legislation banning the use of single-use plastic bags in retail. The legislation has now been implemented in a number of countries and Bong said there were large opportunities in this fragmented product category.

„The uncertain political and financial situation in Europe makes it very difficult to predict the second half of the year, but our goal is still to make profit on bottom line for 2016,” said Bong CEO Stéphane Hamelin.

Kristianstad, Sweden

Autor: Andy Braithwaite, 18 July 2016

Źródło: http://www.opi.net