Rexam on target despite ‘challenging’ conditions

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Packaging giant Rexam has issued details of its Q3 performance – the results were in line with expectation, said CEO Graham Chipchase.

The company’s beverage can division saw global volumes rise 6% in the quarter while Rexam’s healthcare performed less well, partly due to a decline in business in its animal health operation.

“We announced the sale of our personal care business in July 2012 for $709m (£447m), to be sold in two parts,” Rexam said in a statement. “The divestment of our high barrier food packaging business completed on 31 August 2012. We have received the necessary regulatory approvals from the US, Europe and Brazil to complete the sale of the cosmetics, toiletries and household care business and are now awaiting approval from the Chinese authorities.

“Although the timing of this final clearance cannot be certain, we are still targeting completion by the end of this year.”

Rexam’s net debt at 30 September 2012 was £1.2bn, lower than at 30 June primarily due to the £158m of proceeds from the sale of its high barrier food packaging division.

“Despite a challenging trading environment, the group's overall performance is broadly in line with our expectations,” said Chipchase. “The divestment of personal care is in its final stages and we are on track to return £370m of the proceeds to shareholders.

“We continue to focus on generating cash, managing costs and improving return on capital employed, and our progress to date gives us confidence in achieving our 15% return on capital employed target by the end of 2013.”