What Courtaulds calls the 'under-recovery' of the high costs associated with building the brand will leave Tencel in loss for the year. Plans for a new plant in the region have been put on hold until more settled economic conditions are achieved. The situation elsewhere in chemicals & fibres cannot be described as good. Margins are being squeezed by the strength of sterling, the result being the UK job losses.
Courtaulds will sell to Hoechst its stake in the oriented polypropylene joint venture and acquire Hoechst's stake in the European Fibres joint venture. The result will be a net gain in the 1997/98 accounts. The viscose fibre business continues to be under severe pressure and Courtaulds says that its global capacity remains under review.
Source: ICIS 7th March 1998