The Greenock-based firm unveiled an operating profit of £28.6 million for the 12 months to the end of December, up from £26.7m the previous year, despite sales falling 6.2 per cent to £468m.
Sales were hit by the impact of exchange rates and lower demand from some sectors across the UK, including the loss of an unprofitable contract to supply refuse sacks to a “major retailer”.
However, chairman Cameron McLatchie said today’s results, which showed the seventh consecutive rise in annual profits, were “extremely encouraging”.
He told investors that the new year had “started well” and its board was confident that “2016 will deliver further progress”.
BPI admitted that its prediction of an easing in raw material costs stemming from the slide in crude had been proved “spectacularly wrong”, and polymer prices had actually jumped some 50 per cent between early March and the end of June, marking “the greatest short-term increase that our industry has ever experienced”.
It added: “Although polymer prices have subsequently eased back, they are still some 20 per cent above last February, despite the continued fall in the oil price, with producers’ margins over oil at very high levels. Middle East polymer producers continue to favour the Far East market, due to logistics costs and duty when importing product into Europe, and we still await new North American capacity, based on shale gas, coming on-stream.
“It remains our view that polymer in Europe is overpriced and that we will see reductions in the medium to longer term. However, until we can see a few more shipments of polymer heading towards Europe, we feel that European polymer producers may be able to take advantage of the current market position, particularly if there are any further plant outages.”
The company proposed a final dividend of 12p a share to be paid on 13 May, up from 11p last time, lifting the total payout for 2105 by 12.5 per cent to 18p.