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Gains from condom unit sale catapults Australia's Ansell profit six-fold

[SYDNEY] Australian rubber products maker Ansell Ltd said on Monday its underlying half-year profit rose six-fold, as it recognised gains from the divestment of its Sexual Wellness unit.

Proceeds from the sale of US$359.9 million after tax, slightly lower than the previously expected US$365 million, lifted net profit for the six months to Dec. 31 to US$428.2 million from US$69.8 million a year ago.

Ansell sold its condoms business for US$600 million last May to China's Humanwell Healthcare Group Co Ltd and CITIC Capital China Partners, and had expected a US$365 million after-tax gain year on the sale.

"The company is now focused on growing its core, market leading, industrial and healthcare businesses," Chairman Glenn Barnes said.

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Earnings per share (EPS) for the half-year was US45.3 cents from continuing operations, up from 36.1 cents a year ago. The company raised full-year EPS guidance to US$0.96-$1.06 from US$0.91-$1.01.

Ansell declared an interim dividend of US20.50 cents per share, up from US20.25 cents a year ago. The company reports in US dollars.

Ansell, which is now focused on making and wholesaling industrial and medical products from rubber gloves to diving suits, had been hurt by a spike in rubber prices a year ago, when benchmark rubber futures touched a five-year high.

It raised prices in response, negatively impacting its first-half margins, taking the pre-tax profit, excluding the sale, down 19 per cent to US$57.4 million.

Ansell booked a hit to the earnings before interest and tax line because of restructuring costs, adding that half-year revenues fell 1.2 per cent to US$766.4 million as it was without earnings from the flagship condoms division.

The company's shares were up 0.9 per cent, compared to the benchmark equity index's fall of 0.4 per cent.

REUTERS

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