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Interbulk profits hit by euro crisis

Interbulk chairman David Rolph said: "After two years of strong revenue growth, the weak external business environment – evident following the euro crisis – has impacted activity levels in our main market, the European chemical sector."

FEELING THE PINCH: Clyde Blowers chairman and chief executive Jim McColl. Picture:Jamie Simpson.
FEELING THE PINCH: Clyde Blowers chairman and chief executive Jim McColl. Picture:Jamie Simpson.

The company was cautious about the outlook in its core sector. "In the short term, hopes of economic recovery in Europe have suffered new setbacks, and uncertainty remains for the period ahead," it told investors.

Interbulk said it had scaled back further equipment purchases "until clear recovery is evident". It said its liquid bulk business would remain under pressure although in the medium term it expected growth in the global chemicals industry to support the logistics sector.

It said: "The use of tank containers for transporting liquid chemicals has strong underlying growth because of the superior benefits they bring and the growing quantities of chemicals on the move.

"Our liquid bulk business is well established globally and we have progressively enlarged the size of our fleet to grow with the market."

Things were more positive in its dry bulk business. It had been struggling to turn revenue expansion into profit growth but over the year profits recovered thanks to strong growth in demand from the food industry.

Interbulk said its alliance with domestic player Sinotrans had progressed, adding: "Weak and volatile market conditions impacted our business performance during the year. The European market was especially difficult and we expect this to continue to be the case, at least over the short to medium term.

"Nevertheless, we have fully maintained our customer base and we have also delivered on a number of strategic elements that have contributed to the year's performance and established the path for the future."

Net debt at the company, most of which is owed to Bank of Scotland, fell 13.5% to £72.5m.

Interbulk said that a refinancing agreed in October should knock £1.5m off its annual interest bill.

Mr McColl engineered the creation of Interbulk in 2006 aiming to benefit from consolidation in the fragmented container market.

Interbulk's shares closed at 7.12p, a 0.5p fall on the day.

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