Sausage skin maker hails meaty profit performance

SAUSAGE skin maker Devro yesterday hailed its "strong" performance since the start of the year, prompting its house broker to hike its profit forecasts.

Speaking ahead of the Moodiesburn-based group's annual general meeting, chairman Steve Hannam said the business was trading ahead of expectations and expected the trend to continue.

Shares closed 4.6 per cent higher at 175p, giving the firm a market value of about 285 million.

Hannam told investors: "Devro has performed strongly in the year to date compared to the same period in 2009, and ahead of our expectations.

"Sales revenues have continued to grow. Our global coverage and commitment to customer service are being rewarded with new business and growth across our markets."

Favourable movements in exchange rates and lower raw material and energy prices than in the first half of 2009, when they were "abnormally high", had boosted performance, the chairman added.

Broker Investec upgraded its previous first-half earnings expectation by 9 per cent. That meant it was "tentatively" forecasting a 50 per cent year-on-year jump in interim pre-tax profit to 14.6 million. For the full-year, it expects pre-tax profits to come in at 32.7m, some 2.5m more than it had previously anticipated.