UPDATE 1-Victrex profit rises on higher polymer sales

Tue May 20, 2014 4:33am EDT

* First-half pretax profit up 7 pct at 48.9 mln stg

* Says second half has begun well

* Shares rise as much as 3 pct (Adds details , updates share movement)

May 20 (Reuters) - Specialty plastics maker Victrex Plc reported a 7 percent rise in pretax profit for the first half as higher polymer sales volumes offset lower margins.

Victrex, whose PEEK thermoplastic resins, film and pipe are used in the Boeing 787 aircraft, said its second half had started 'well' with initial volume trends building on its first-half performance.

However, the company, which generates about 97 percent of its revenue outside the UK, warned of adverse currency exchange movements.

Pretax profit for the six months ended March 31 grew to 48.9 million pounds ($82.3 million) from 45.7 million pounds a year earlier. Revenue grew 13 percent to 120 million pounds.

Analysts on average expected the company to report pretax profit of 49.05 million pounds on revenue of 97.7 million pounds, according to Thomson Reuters I/B/E/S.

A 14 percent jump in sales volumes compensated for a fall in gross margins, which decreased to 64 percent from 67.2 percent a year earlier. Volumes were driven by sales at its core Victrex Polymer Solutions business that caters to the automotive, aerospace and industrial markets.

The company on Tuesday also appointed Lawrence Pentz, current non-executive director, as its new non-executive chairman effective Oct.1. Pentz replaces Anita Frew, who retires in September.

Pentz also serves as an executive director at catalyst maker Johnson Matthey.

Victrex, whose polymers are used in smartphones, aeroplanes and cars to oil & gas equipment and medical devices, raised its interim dividend to 11.39 pence from 10.35 pence a year earlier.

Shares in the company were up 2.2 percent at 1736 pence at 0832 GMT on the London Stock Exchange on Tuesday. They touched a high of 1738 earlier in the session. ($1 = 0.5943 British Pounds) (Reporting by Karen Rebelo in Bangalore; Editing by Gopakumar Warrier)

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