SOUTH AFRICA – Nampak Ltd, the South African plastics bottle manufacturing company has welcomed proposal to sell its glass division in a way to create a more profitable business and address a skills gap, report Reuters.
In addition to inconsistent electricity supply and insufficient technical skills at its glass division, the group highlighted that it was also facing an unnamed new entrant in the South African beverage can market.
In November last year, Nampak announced that it was seeking high-level skills to boost its glass-making skills and address challenges in production and operational skills.
These factors are likely to weigh heavily on its interim results expected to be reported on May 30 for the six months to end March.
“Discussions with a major customer regarding the renewal of an existing supply agreement that comes to an end on March 31 are in progress and we expect that some volume will be allocated to the new entrant,” statement from Nampak said.
“The strengthening of the rand will adversely impact the translation of foreign earnings for all rest of Africa territories, but will benefit the translation of the group’s dollar-denominated borrowings.”
Business Day reports that trading update included a breakdown of the cash balances Nampak holds in various countries along with an indication on whether the money could be brought back to SA.
While cash balances in Nigeria fell to US$49.62m as at the end of February, its Angolan cash balance grew from US$186.29m by September to US$220.16m at the end of February.
After announcing impairments of US$20.92 million attributable to Nampak Plastics Europe, the packaging manufacturer debuted plans to restructure its plastics business in SA and Europe.
In the middle of a global outrage on plastic pollution, Muller, the multinational producer of dairy products in the UK and Ireland announced plans to acquire more bottle manufacturing plants owned by Nampak in a way to reduce plastic packaging use.