STOCK MARKET
Big drop in Sappi price not warranted, says CEO Steve Binnie
The more than 10% fall in Sappi’s share price in Monday’s early trade after it reported lower quarterly profit and earnings, was an overreaction, says CEO Steve Binnie. The decline in the share price, the biggest intraday drop since July 2015, wiped off about R5bn of the company’s market capitalisation. It closed 9.51% weaker at R91.30. Binnie said even though the company experienced nonrecurring operational and production problems at its SA and North American businesses during the quarter, these did not warrant the massive drop in the share price. "This seems like an overreaction," he said. The once-off problems pertained to longer than anticipated shutdowns at its Somerset Mill in the US and Ngodwana, Mpumalanga plant, said Binnie. Sappi spokesperson Andre Oberholzer said on Monday that problems with third-party contractors caused the delays. Binnie said that as a result of the operational and production problems, "lost opportunity" for Somerset Mill and Ngodwana operations were $...
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