JSE-listed packaging group Astrapak expects to post half-year losses as difficult trading conditions, a fire and restructuring hampered its performance.

Earnings a share were expected to dip into the red during the six months ended August 31, as the company reported a 240% to 260% decrease on the 16.9c reported during the corresponding six months of the year before.

Astrapak said in a trading update that headline earnings a share from continuing operations would remain in the black, despite an expected 40% to 60% fall during the period under review, compared with the 22c a share recorded during the first six months of 2012.

“Despite the reduction in headline earnings a share from continuing operations, the result is reasonably expected to be better than management had budgeted for,” Astrapak commented in a statement.

Profit from continuing operations before exceptional items is expected to show a decline of between 20% and 40% in comparison with the comparative six-month period last year.

The company reported a R35-million exceptional loss, which included a one-off item in respect of insurance and impairments related to the discontinuation of its Packaging Consultants business unit.

“Astrapak has required structural and behavioural adaptations and stricter operational discipline; as a result, there have been substantial senior staff changes and reduction programmes have been initiated.”

Further, a fire at the company’s East Rand Plastics facility caused severe disruption for a protracted period of time and resulted in poor performance from the Astrapak Flexibles segment and losses from the East Rand Plastics segment.

The difficult trading conditions, which were compounded by rising polymer, electricity and labour costs, as well general market price sensitivity and the restructure that had emerged from a comprehensive review, would also impact the full financial year to February.

“Legacy issues are being comprehensively dealt with and the ground laid for a much firmer financial footing going forward,” Astrapak assured shareholders.

The company was expected to release the financial results for the six months on September 27.