Recticel feels future bright

By Liz White, UT contributing editorBRUSSELS-Belgian foamer Recticel said it had a "disappointing" 2003, but forecasts a profitable 2004, thanks to restructuring, it also sees "strong prospects for 2005."Sales rose only 0.5 percent to €1184 million for 2003, while operating profit was €17.2 million compared to €40 million for 2002. The net result was a loss of €15 million versus €23 million profits in 2002, Recticel said in its results statement. Recticel said its insulation and flexible foam businesses showed strong performance "in spite of the difficult market," while automotive and bedding had lower profitability. The decline is attributable to many external factors-such as lower Ford Mondeo volumes, delays in starting up various automotive contracts, and persistent pressure on consumption in the bedding sector, the firm said.Extraordinary charges of €7 million include the "substantial cost of additional restructuring." Following 500 job cuts in 2002, Recticel has cut another 1000 or so jobs during 2003. In Germany and the Netherlands, the group closed two bedding plants and is now in the process of shutting two conversion units-at Wabern and Bad Ditzenbach-in Germany. The firm also stopped two of the three production lines at its Hulshout plant, in Belgium. The group is also restructuring at 10 other plants, including its headquarters, while "general administration costs and research and development costs were slashed," Recticel's results statement said. Costs of €9 million for these changes were booked to the 2003 accounts.These measures will yield structural savings estimated at €16.3 million for 2004 and €19.3 million for 2005.For 2003, Recticel's results integrated: * The remaining half of Greek flexible foamer Ricomex, representing sales of €2.5 million; * 51 percent of the activities of the Trilport, France, automotive plant-accounting for €2.6 million; * Half of Japanese firm Inorec.Earlier this year, Recticel and Woodbridge Foam's six continental European plants were united in the Recticel Woodbridge Moulded Foam joint venture-which is becoming the leading independent European supplier of moulded foam seating, with a 25-percent market share, Recticel claimed. "