McBride tumbles as it warns on profits

McBride shares tumbled on Wednesday after it warned on full-year profits, citing rising input costs.

McBride said the final quarter of trading for the current financial year ending 30 June 2021 is expected to be "significantly" weaker than the first nine months of the year and its full year profits - measured by EBITA - are now expected to be down around 15% on the year.

The household and professional hygiene products manufacturer said input costs have continued to increase sharply, while sales have been subdued and revenues are now expected to be down around 6% on the year in the second half, at constant currency.

The company said that in recent weeks, there has been "further rapid, significant and sustained price escalation" for many of its raw materials, particularly core chemicals and plastics.

"Our current view is that we will see further double-digit increases on average across these materials and packaging items by June 2021 - more than double the rates of increase expected in mid-March 2021. Additionally, we do not see these prices returning to more normalised levels in the near future," it said. The company's liquids division is taking the biggest hit from the price increases.

In addition, revenues remain volatile in most of its markets. McBride said that since its half-year results, demand for auto-dishwash products has remained strong but volumes in household cleaners have been normalising from the peaks seen in 2020. Sales of laundry and personal care products have remained very subdued, meanwhile.

"With lockdowns lasting longer and still in place across many of our markets, we do not now expect certain category volumes to pick up in the balance of the financial year and therefore the Liquids and Aerosols businesses have reduced their demand outlook for the final quarter."

At 1250 BST, the shares were down 17.2% at 77.49p.