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News
Amorim Cork sales rise as market remains challenging
Global cork supplier Amorim has reported that sales have increased slightly by 0.6% in its Cork Composites division amidst challenging market conditions for the industry.
The firm reported for the first quarter that EBITDA margin had improved to 18.6%, despite a drop in volume sales and increased cork prices. It reported net earnings of €16 million, which was down 32%, but with a reduction of net debt to €237 million.
Corticeira Amorim’s consolidated sales totalled €234.7 million, which was down 9.7% on the same period of 2023, and was mostly due to a decrease in sales volumes.
All of its business units “experienced pressure on sales”, with the exception of Amorim Cork Composites, whose sales increased slightly to €27.5 million.
Sales by Amorim Cork declined 10.4% year-on-year, which accounted for 77% of total consolidated sales, were penalised by a reduction in volume sales across all segments, while benefitting from improvements in the product mix and the introduction of price increases.
Prices
Pressures come as raw material cork was purchased at higher prices and the negative impact of operational deleveraging.
But it said that Amorim Cork and Amorim Cork Composites “stood out in terms of improving profitability in the period”.
Among other factors, this reflected reductions in the cost of non-cork raw materials and improved industrial efficiency, it said.
At the end of March, net interest-bearing debt had decreased to €236.7 million, despite an increase in working capital needs of €25.7 million, and increased investment in fixed assets of €12.4 million.
Unfavourable
António Rios de Amorim, chairman and CEO described the firm being impacted by “unfavourable market conditions”.
He said: “Faced with the negative impact of operational deleveraging, reflecting a contraction of volume sales in the sectors where we operate, and higher cork consumption prices, we focused our efforts on increasing industrial efficiency, improving the product mix and gaining market share.
“In a climate marked by a high degree of uncertainty, we aim to make 2024 a positive year for Corticeira Amorim. We are counting on the resilience and dedication of our People, confident that the investments that we have made in recent years will enable us to continue providing innovative products and solutions and to conquer new markets and customers while protecting profitability levels and strengthening our financial solidity.”