Packaging group Transpaco shaved its interim dividend as tough trading conditions squeezed margins. Results released on Tuesday showed Transpaco — which operates plastics and paper packaging facilities — limiting the decline in headline earnings to 5.4% at 168c per share in the half-year to end December. The company, which has traditionally been a strong cash generator, reduced the interim dividend to 45c per share from 48c per share in the previous interim period. The dividend reflects a fair degree of caution around the outlook for the packaging operations, covered a conservative 3.7 times by headline earnings. Transpaco’s turnover for the interim period declined 3% to R877m. Directors indicated that the plastics division, which experienced price deflation, was the main drag on top line. The operating margin was squeezed to 8.95% from 9.11% previously. Transpaco CEO Phil Abelheim said margin pressure was partially offset by "stringent well-managed expenses". The larger plastics di...
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