Glasgow-based sausage skin and collagen products firm Devro said currency gains helped its 2016 revenue increase 4.7% to £241.1 million — but in constant currency its revenues declined 6.9%.
“Volumes in Latin America, Continental Europe, Russia and China reduced, although China returned to year-on-year growth in the final quarter,” said Devro.
“The performance in these areas was partially offset by increased volumes, and stable or increasing local currency average sales prices, in Japan, South East Asia and the UK & Ireland.”
Underlying operating profit increased 14% to £38.1 million as it benefited from currency movements and lower input prices, which offset the effects of lower sales volumes.
Statutory profit before tax fell to £6.2 million from £15.1 million, and dividend was unchanged at 8.8p.
In his outlook, Devro CEO Peter Page said demand remained strong and Devro continued to opportunities to grow the business.
“In 2017, we will focus on increasing revenue to regain market share, achieving cost savings across our global operations and commencing the launch of new, differentiated products, as part of the Devro 100 programme,” said Page.
“The further exceptional costs of this programme are expected to be between £10-12 million over the next two years, plus capital investments of between £7-8 million, with expected benefits of between £13-16 million per annum by 2019.
“Over this period there will also be a focus on reducing net debt levels.”
Page added: “Whilst volumes declined by 6.6% year-on-year, underlying operating profit increased due to lower input prices and exchange rate benefits.”