Rexam Gains as Europeans Give up Pub Going

Rexam reported stronger first-half profits; can volumes were supported by Russians and Western Europeans opting to drink at home

Thomas Mullarkey, CFA 5 August, 2011 | 10:18AM
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Rexam (REX) reported measurably stronger first-half profits on relatively flat top-line growth. Earnings per share increased 19% to 18.9 pence in the first half, compared to 15.9 pence during the comparable, year-earlier period. Its beverage can segment operating profit in the first half climbed to £212 million (11.3% of sales), versus £196 million in the year-ago period. Profitability improved thanks to strong demand in Europe driven by Russians and Western Europeans becoming more prone to pass on the draught beer at the pub to drink at home instead. Going forward, we expect Rexam's 2012 and 2013 beverage can volumes will increase.

Find out the top three drivers of can beverage volumes here.

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Thomas Mullarkey, CFA  is an equity analyst at Morningstar.

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