Managing Director’s Business Review

Nuplex’s results for 2007/08 — in line with market guidance and expectations — were a rewarding outcome from a three—year turnaround strategy. Such success is only possible with high performing people building an effective business plan and then executing it well.

The value of the Company’s acquisition strategy in geographical globalisation and technology positioning is particularly evident. Firstly, there has been a substantially improved performance in Europe. This more than covered the shortfall in contribution from Australasia which is struggling with a dormant and softening industrial sector. And secondly, new and sophisticated technology has protected historical business positions while opening up segments where the Group has not previously been a significant participant.

The major restructure and integration activities of the Group are complete. It now has the capacity, technology, operational efficiency and market opportunity upon which to continue its history of growth.

The year’s results were particularly pleasing as they were achieved in spite of difficult trading conditions. Continuing rises and instability in crude oil pricing; vegetable oil costs responding to a demand for biodiesel; petrochemical prices maintaining their upward movement – all combined to keep pressure on input costs. Added to this, the cost of utilities, transportation, wages and salaries eroded benefits of efficiencies and volume growth in some regions. Supply interruptions inhibited sales for a number of distributed materials, and, finally, some markets fell into a hole.

 

John Hirst
Managing Director