Following a fire at Astrapak’s East Rand Plastics operation on January 8, the company has declared force majeure in terms of certain customers and markets which the company says it can no longer service satisfactorily.

“This was despite all possible mitigating actions, which included outsourcing, intergroup production and the recommissioning of certain mothballed equipment,” the packaging firm said on Wednesday.

As a result of the consequent reduction in turnover, the cost base of the business had also been reduced, the company reported in a trading update.

Astrapak said the insurance assessment process had been completed, with all relevant insurers having admitted liability in respect of the claim and interim payments owing to the company on a regular basis. 

Astrapak would use the insurance proceeds to acquire a new plant to replace the lost revenue and margin stream as and when it identified suitable market opportunities.

Meanwhile, the company had completed the reorganisation of its operations into divisional units, which aligned management structures with the new operational structure and the company’s strategic initiatives.

“The recruitment process has also been completed and most executive positions have been filled,” the company reported.

Financial Results
Astrapak expected its headline earnings a share (HEPS) for the year to be between 52% and 72% lower than that reported in the comparative period, resulting in an anticipated HEPS of between 7c and 12c.

HEPS from continuing operations were expected to be between 8.9c and 20c, or between 64% and 84% lower than that reported in the comparative period.

This was owing to losses realised as a result of the factory fire, as well as difficult trading conditions.

However, earnings a share (EPS) were expected to be between 425% and 445% higher than that reported in the comparative period, resulting in anticipated EPS of between 108.3c and 115c.

EPS from continuing operations of between 125.2c and 125.5c was expected to be between 8 247% and 8 267% higher than the prior comparable period.