Antalis Slowdown Continues

Originally written by Joshua Allsopp and published by OPI

Brexit slowdown to continue for Antalis

European paper merchant Antalis was feeling the effects of a drawn-out Brexit.

In an announcement by owner Sequana, the Paris-based group warned that Q4 sales would continue to decline as uncertainty related to the UK’s departure from the European Union took its toll on trading.

Demand in the UK and Ireland, which together account for 26% of Antalis’ sales, has been weak in the nine months since January and the group expected these unfavourable trends to continue in the fourth quarter.

Sales totalled €1.77 billion ($2.06 billion) for the first nine months of the year, down 3.8% on the same period last year.

Overall, its main European operating regions – UK & Ireland, France, Germany & Austria – reported sales of €899 million, down 5.6% on last year. This was attributed to the decline in paper volumes, especially in the UK and the depreciation of the British Pound.

For the year as a whole, Antalis said it would continue to “reap the benefits” of its margin protection policy, the growing contribution of its Packaging and Visual Communication segment, and reduced overheads thanks to greater flexibility across its supply chain.

The group now expects full-year sales to register a low single-digit decline compared to FY 2016 and EBITDA margin of between 3.4-3.8%.

For the nine months ended 30 September, sales for the rest of Europe were down by 3.1% to €701 million. Meanwhile, sales for the Rest of the World grew by 4% to €170 million thanks to a favourable foreign exchange effects.

Speaking to OPI, Antalis Regional Managing Director for UK, Ireland and Southern Africa David Hunter commented: “From a customer’s perspective, we’re hearing that some are holding off on any major investment decisions until the longer-term state of the economy and political landscape becomes clearer. This is further compounded by Brexit uncertainty negatively impacting the value of the British pound which affects UK prices, making already difficult trading conditions that much harder.”