Ansell triples profit after selling condom business

Ansell triples profit after selling condom business

Bolstered by a US$343 million (AUD$469.9 million) gain on the sale of its condom business to a Chinese consortium earlier in the financial year, Ansell's (ASX: ANN) net profit has more than tripled to $662.4 million.

The company's underlying profit after tax rose 16 per cent to US$138.8 million, while total sales dropped 0.8 per cent to US$1.55 billion also due to the sale.

The sale was announced in August 2016 as part of a portfolio review which also included a $265 million share buy-back.

Ansell is now solely in the business of creating other kinds of protective gear like gloves for healthcare workers.

Ansell's former sexual health business, which gave rise to arguably its best known products, dated back to the Great Depression when entrepreneur Norman Ansell departed from the Dunlop Company of Australasia in 1929.

The entrepreneur started making condoms, which grew significantly in popularity, before moving on to gas masks, weather balloons and latex gloves. 

Ansell chairman Glenn Barnes says the group's results are positive considering the massive changes that have occurred.

"The year has seen significant positive change in our company as we re-shaped it to be a sharper focused enterprise following our exit from the Sexual Wellness business," says Barnes.

CEO and managing director Magnus Nicolin says the company's new plans are well underway.

"Ansell continues to make progress in the execution of its growth strategy driven by innovation, emerging market expansion, brand focus and distribution partnerships," says Nicolin.

"It was also encouraging to see the strong improvement in margins through the year following a first half that was affected by temporarily higher raw material costs."

"The Transformation Program continued to progress well and is slightly ahead of expectations at this point."

A final dividend of US$0.25 per share unfranked has been declared.

Shares in Ansell are down 8.72 per cent to $25.39 per share at 11.45am AEST.

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