LONDON — Courtaulds PLC reported a 13.9 percent drop in operating profits at its fibers and chemicals division to $139.5 million (93 million pounds) in the year ended March 31.
Sales fell 6.2 percent to $1.09 billion (727 million pounds).
The decline in profits and sales was concentrated in the group’s U.S. rayon operation and acrylics business, which were hit by a mid-year credit squeeze in China that resulted in cheap imports flooding Europe and led to lower fiber prices, the company said.
The acrylics business recovered in the fourth quarter following the easing of the Chinese credit squeeze, said Sipko Huismans, Courtaulds chief executive officer. Viscose suffered similar pressure, although the group’s profits in viscose were up last year. Overall, Courtaulds reported a 43 percent drop in net profits last year to $122.1 million (81.4 million pounds) on flat sales of $2.93 billion (1.95 billion pounds). The sharp profit fall reflected exceptional charges totaling $74.6 million (49.7 million pounds) to cover the costs of restructuring the group’s businesses in coatings, sealants and tubes.