The company behind the Sorbent toilet paper and Libra pads brands has warned its half-year profit will drop by almost a quarter due to increased competition, discounting and higher manufacturing costs.
Asaleo Care says unaudited net profit for the six months to June 30 is down 23 per cent from a year earlier to $24.9 million, and it has cut its full year underlying profit guidance from unchanged to a 15 per cent decline.
Sales of tissues, toilet paper and personal hygiene products have dropped because of discounting by competitors and higher spending to support its market share, the company said.
The compay said the cost of pulp used in toilet paper manufacturing had also risen.
"Whilst it is disappointing to announce reduced results and outlook for the full year, we continue to believe that the strategy and initiatives which we have implemented and planned will put the company in a strong position going forward," chief executive Peter Diplaris said.
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Asaleo Care shares plunged, dropping 63.5 cents, or 29.7 per cent, to $1.505.
