UPDATE 1-Specialty plastic maker Victrex warns of adverse currency impact

Tue Apr 8, 2014 3:06am EDT

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(Adds analyst comment, share movement)

April 8 (Reuters) - British specialty plastics maker Victrex Plc warned that currency exchange rate movements would hurt its results in the second half of the year ending September.

Victrex, which generates about 97 percent of its revenue outside the UK, also said the adverse impact would continue into the next financial year.

The company, whose PEEK polymer is used in aircraft components, car parts, surgical implants and engineering equipment for oil and gas companies, said sales volumes for the first half ended March 31 rose 14 percent to 1584 tonnes.

"We remain very mindful of a much tougher year-on-year comparative for the second half, and of currency headwinds," the company said on Tuesday.

Victrex said although growth in the first half was strong it saw a less favourable sales mix.

Revenue from the company's Invibio Biomaterial Solutions business - which provides PEEK-based polymers to manufacture long-term implantable medical devices - increased about 12 percent to 26.9 million pounds ($44.68 million), helped by a recovery in the spine market.

"A robust volume figure for the second quarter would appear to confirm that growth is returning. However, negative exchange rates and a less favourable mix suggest that not all of this will flow through to the bottom line," JPMorgan Cazenove analyst Martin Evans wrote in a note to clients.

Victrex's shares were up 1.24 percent at 2020 pence at 0804 GMT on the London Stock Exchange on Tuesday. ($1 = 0.6020 British Pounds) (Reporting by Karen Rebelo in Bangalore; Editing by Joyjeet Das)

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