By Vince Chadwick
GLOVE and condom maker Ansell says it will look to emerging markets to drive growth after recording a modest profit increase of 1.1 per cent for the six months to December 31.
Chief executive Magnus Nicolin saw the first-half growth rate as ''sloping up but still a plateau'', with uncertainty in Europe and a bungled systems upgrade in North America acting as a drag on the business.
Gloves are off: Ansell plans to go after new markets.Credit: Peter Rae
The Melbourne-registered company increased its net profit to $64.9 million, up from $64.2 million in the previous corresponding period.
Earnings per share rose 2 per cent to 49.3¢ but revenue fell 3.9 per cent from $621.8 million to $597.7 million.
Mr Nicolin said industrial sales slackened in Europe, which he expects to remain troubled in the next half.
By contrast, Ansell saw 28 per cent year-on-year growth in China while sales across all emerging markets grew by 16 per cent to now provide almost a quarter of the company's total revenue.
A multimillion-dollar investment over three years to merge business processes in a single platform backfired in North America, where the wrong product was shipped in the wrong quantities.
Mr Nicolin said big customers had stuck with the company but it had lost business with some smaller customers.
Ansell's main competitor, Durex, has been severely disrupted by a dispute with its Indian supplier, prompting suggestions that Ansell might increase its roughly 15 per cent share of the global condom market.
Mr Nicolin, however, put a rise in condom sales down to the company's promotion of its new Skyn range.
Ansell took a minority stake in Yulex Corporation to tap into guayule latex, a shrub grown in arid climates.
Chief financial officer Rustom Jilla warned it was too early to consider price reductions as latex remained a volatile commodity.
With AAP