Rexam: Analysts See Annual Profit Up 7%

Rexam Plc is expected to post a 7% increase in annual underlying profit when it releases figures for 2005 on 22/02/06, but high energy & raw material costs may hit 2006 margins. With competitors such as Crown Holdings & Ball Corp. reporting lower earnings, investors will focus on outlook & strategies to cope with rising costs, which are likely to exceed price increases. "Rexam needs to raise prices in Europe or suffer further margin pressure. The risk to investors is that not all the cost increases are absorbed by the price rises & forecasts for 2006 are downgraded further," Teather & Greenwood said. Rexam is likely to report £308.6M in pretax profit for 2005 on sales of £3.17BN, according to a Reuters poll of nine analysts.