UPDATE 2-RPC says demand rising for specialised packaging products

Wed Jun 4, 2014 8:05am EDT

* Adjusted operating profit rises 10.6 pct to 101.3 mln pounds

* Full-year revenue up 7 pct

* Shares rise as much as 6 pct to year high (Adds CEO, analyst comments; updates shares)

By Tasim Zahid

June 4 (Reuters) - Plastic packaging maker RPC Group Plc reported a rise in full-year operating profit and the company said it was seeing higher demand for its specialised packaging for cosmetics and pharmaceutical products, among others.

Shares in the company, which makes packaging for Nivea creams and Nescafe's coffee capsules, rose as much as 6.3 percent to a year high. The stock was one of the top percentage gainers on the FTSE-250 Midcap Index on Wednesday.

Analysts said demand for specialised packaging products was rising as economic conditions in Europe were improving.

"When market conditions improve, there is a greater tendency for companies to launch or introduce new packaging ... and (RPC) should increasingly benefit from this and the ongoing upward trend in higher added value products," Edison Investment analyst Toby Thorrington told Reuters.

RPC, which is among the world's top plastic packaging makers, said business this year so far was in line with expectations.

"We see more customers thinking about longer-term projects in higher added-value products," RPC Chief Executive Pim Vervaat told Reuters.

The company makes a range of specialised plastic containers, including thick-walled glass effect jars for cosmetics, inhalers with dosage monitors and oxygen-barrier packaging that improves the shelf life of food and beverage products.

Vervaat said RPC was in talks with two large potential customers in China - a major personal care company and a fast-moving consumer goods producer. He did not name the companies.

Analysts at Panmure Gordon said in a note that they expected RPC to do well as it expands its geographic spread.

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RPC has been pursuing acquisitions aggressively as it attempts to woo clients in markets beyond Europe.

The company made a big push into Asia last month by acquiring Hong Kong-based ACE Corp Holdings Ltd, gaining access to five manufacturing plants in China, including one in Hefei city adjacent to Unilever Plc's biggest Chinese plant.

In December, RPC acquired UK-based Maynard and Harris - whose clients included cosmetic giants L'Oreal and Estee Lauder - and consumer food packaging maker Helioplast, widening its reach in southeast Europe.

RPC's revenue grew 7 percent to 1.04 billion pounds ($1.74 billion) in the year ended March 31, with acquisitions accounting for 3 percent of the growth.

The rise in revenue was driven also by higher sales in packaging for personal care, pharmaceutical and high-barrier foods products and single-serve beverage systems.

Adjusted operating profit rose to 101.3 million pounds from 91.6 million pounds, a year earlier.

The Rushden, Northamptonshire-based company's shares were up 4.6 percent at 651 pence at 1150 GMT on the London Stock Exchange. ($1 = 0.60 British pounds) (Additional reporting by Roshni Menon; Editing by Gopakumar Warrier and Kirti Pandey)