Trading Update - Group Sales Up 6%
Cookson Group PLC
8 November 1999
TRADING UPDATE
At the interim results presentation in July, Cookson
Group plc indicated that, consistent with past
practice, it would present shareholders with a
progress report on trading after the end of the
third quarter. The following statement also
precedes a trip to Munich arranged by the Company
later this week for sector analysts to visit
Productronica, the world's largest trade fair for
the electronics industry.
'The momentum seen in the second quarter of 1999 was
maintained in the third quarter. Group sales for
continuing activities were up 6% over the same
quarter in the previous year at constant exchange
rates and excluding sales of the Premier
Refractories and Plaskon acquisitions. This
compares with an increase of 2% in the first half.
As a result, profit before tax for the third quarter
was well up on that of 1998, though still below last
year for the nine months to date.
In the Electronics division, sales were 12% higher
than the third quarter of the previous year
excluding the contribution from the Plaskon
acquisition, well up on the 2% increase in the first
half of the year. The Assembly Materials sector
performed well, particularly in the Asia-Pacific
region and the PC Fabrication sector achieved sound
sales growth. Bookings in the Assembly Equipment
sector remained strong, with order levels at the end
of October 40% higher than the same month end last
year and 8% up on the end of the second quarter of
1999.
A modest improvement in the North American steel
market began to take hold towards the end of the
third quarter and steel production increased by 1%
over the same quarter in the previous year. In the
Europe, however, no real signs of recovery were
evident and steel production was down 1%. Shipments
from the Glass and Foundry sectors also remained
low, as anticipated. As a result, sales for the
Ceramics division showed limited progress in the
third quarter, rising only 1% over the same period
in 1998, excluding the contribution from Premier
Refractories.
In the Engineering division, the US operations of
the Precious Metals sector performed in line with
expectations, though increased imports affected
sales in the UK. The Precision Products businesses
registered another sound performance. In
Telecommunications, Neptco performed well but Focas
suffered from further project delays. In the
Mouldings sector, good progress continues to be made
with the CHEP plastic pallet project and the results
for this sector were pleasing.
The strategy of fundamentally reshaping the Group
into fewer, stronger core businesses continues to be
vigorously pursued. During the third quarter, the
acquisitions of Premier Refractories for £253
million and Plaskon for £77 million, as well as the
disposal of TAM Ceramics for £49 million, were
completed. The previously announced divestment of
Focas is currently in progress.
Trading conditions in the fourth quarter are
expected to remain broadly similar to those of the
third. Demand for suppliers of materials and
equipment to the electronics industry is expected to
remain buoyant, conditions in the steel industry are
likely to remain challenging in Europe, whereas the
improvement in the US steel market should continue
to take hold. As a consequence, the results of the
Group for the year are expected to remain in line
with the market's expectations.'
For further information, please contact:
Stephen Howard Dennis Millard
Group Chief Executive Group Finance Director
Cookson Group plc Cookson Group plc
London WC2N 6HJ London WC2N 6HJ
Telephone: 0207 766 4500 Telephone: 0207 766 4500
Fax: 0207 747 6600 Fax: 0207 747 6600
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