Revenue at plastic manufacturer IPL Plastics fell 8 per cent in 2019, but improved margins across its divisions boosted earnings.
Adjusted earnings before interest, tax, depreciation and amortisation rose by more than 17 per cent to $91.5 million, as revenue declined to $605.1 million. The fall in revenue was mainly attributed to lower resin costs, which were passed on to IPL customers.
However, the acquisition of Loomans, some growth in volume in North America and some price increases helped offset the fall.
The company said net cash inflow from operating activities increased from by 376 per cent to $89.3 million, with adjusted free cash flow up 381 per cent to $67.4 million. Net income rose to $13.9 million, up from $1.8 million a year earlier.
The acquisition of Loomans pushed net debt higher, increasing from $210.5 million in 2018 to $297.4 million at December 31st, 2019. However, net debt has fallen by $45.5 million since June 30th, 2019.
"Our ongoing focus on rebuilding margins and enhancing operational performance is continuing to pay dividends for the company. While our results for the last calendar year reflect a very strong improvement in profitability and cash generation, we expect to sustain that progress into 2020 with further improvements in performance," said Alan Walsh, chief executive of IPL Plastics.
“Trading across all our divisions is satisfactory to date in 2020 and we expect top line revenue growth in Fiscal 2020 underpinned by new contract wins and a broadly stable resin outlook.
“In addition, we have also published our 2019 sustainability report today which demonstrates that our journey to becoming a global leader in returnable, reusable and recyclable packaging solutions is now well progressed.”
IPL said diluted earnings per share was 33 per cent higher at $0.04.
