Essentra told investors that profit this year would be well below expectations due in part to weak Chinese demand for its tobacco filter products.

Lowering its forecast for adjusted operating profit to a range of GBP 137 million to 142 million (EUR 160 mln – EUR 166 mln) from GBP 155 mln – 165 mln, the independent manufacturer of cigarette filters cited lower than expected sales in its filtration and health/personal care packaging businesses.
“The company has seen recently awarded innovative product wins in filter products in H2 2016,” Essentra said in a trading statement. “However, the ramp-up in these new contracts has been slower than forecast. In addition, the transfer of a particular line of existing business from the US to Asia has been delayed until early 2017. Taken in conjunction with the continuing prolonged underlying softness in the Chinese market, these factors have resulted in lower-than-expected volume across the site footprint, which has a consequent impact on both revenue and operating profit.”