ICIPaints.com Archive
Full details of ICI's third quarter and nine months 2007
2007
Full details of ICI's third quarter and nine months 2007 performance can be seen on the Group's corporate website. The following is a summary of performance for the Paints business only.
Paints comparable sales were 3% ahead for the quarter. Strong growth for the Decorative business in Asia and Latin America offset the impact of continued weak trading conditions for Decorative North America.
Gross margin percentages were marginally ahead of Q3 2006 and with costs below gross margin in line with last year led by benefits from restructuring, trading profit was 10% higher.
For the nine months, comparable sales were also 3% ahead. Gross margin percentages were ahead of last year and with costs below gross margin only slightly increased, trading profit was 10% ahead.
Sales for Decorative UK & Republic of Ireland were in line with the third quarter last year as weak UK Retail market conditions continued to offset growth in the UK Trade and Ireland businesses.
With improved gross margin percentages, trading profit was slightly ahead of the third quarter last year. Decorative Continental Europe sales were 3% ahead of last year, with growth in the Benelux region and Eastern Europe partially offset by weakness in Germany. Although gross margin percentages were lower than last year, good control of costs below gross margin contributed to trading profit ahead of last year.
Sales for Decorative North America were 5% lower than last year due to lower sales volumes for US Retail and US Trade, which were depressed by the continuing weakness in the US housing market. Gross margin percentages improved from last year, including the benefit of a favourable product mix in the US Trade and Canadian businesses. With good control of costs below gross margin and further benefits of restructuring activities, trading profit was ahead.
Decorative Asia had another strong quarter, with sales growth of 21%, reflecting double-digit growth in key developing markets in China, India, Indonesia and Pakistan. In particular, growth in China was over 30%, in part reflecting the benefit of expanded distribution. With higher gross margin percentages, trading profit for the quarter was significantly ahead.
Decorative Latin America had another good quarter with sales up 12%, reflecting volume growth in all countries. Gross margin percentages were broadly in line. Costs below gross margin were higher, but with stronger top- line performance trading profit was ahead.
Sales for Packaging Coatings for the quarter grew by 4%, reflecting improved selling prices. Gross margin percentages were lower due to adverse mix effects and continued raw material cost pressure. However, with costs below gross margin lower than last year, trading profit was ahead.
