Straight profits ‘will be below expectations’

STRAIGHT, the Leeds-based environmental products group, yesterday confirmed that profits for the first half of 2011 would be below management expectations.

In a trading update, the company said group sales increased in the first half of 2011 by 14 per cent to approximately £15m. Straight said this performance had been boosted by recent acquisitions and also by a significant increase in sales in the retail business. The statement added: “Despite this increase, overall sales have fallen short of management expectations. As noted in the AGM statement of May 27, polymer prices rose rapidly to unprecedented levels during the first part of 2011, peaking in May.”

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Straight said these rises had affected the profitability of some contracts and the performance of the recently acquired Powell Plastics operation. The statement said: “The group expects to report a small headline operating profit for the first half, which after reorganisation costs and interest, will result in a loss before tax of approximately £100,000. Following a programme of remedial actions that is already substantially under way, the group expects to return to profitability during the second half of the year.”

Chief executive Jonathan Straight was the 2006 national winner of Ernst & Young’s Entrepreneur of the Year competition.