The rising copper price is helping companies by BHP, Rio Tinto, OZ Minerals, Glencore and Newcrest, but for end users, it starting to be a headache.
Shareholders in plumbing products maker Reliance Worldwide heard yesterday that their company is coming under increasing pressure from the rising cost of copper metal.
Global copper prices are up more than 22% so far this year and over 50% in the last two years.
That’s despite a definite slowing in purchases by Chinese buyers this year – down 9.4% to 3.44 million tonnes, although copper imports in September were the highest since March at 430,000 tonnes.
But the Reliance annual meeting yesterday was told that despite buoyant demand and sales, the cost of copper is starting to hurt.
CEO heath Sharp told the meeting: “I do note that current copper prices are relatively higher than originally anticipated, although offsets in other parts of the business should allow us to absorb this additional cost," he said.
"If the price remains high or moves higher, then we would expect a move on pricing across the market," he added.
He said that company remains on track to realise its full-year earnings guidance of between $145 million and $150 million that it outlined in August when it released its 2016-17 results when it reported a 21.8% improvement in earnings to $120.7 million.
“We project strong top-line growth driven by ongoing expansion of the push-to-connect business in the Americas, inclusion of a full year of Holdrite results, and targeted opportunities to gain market share across new platforms," he told shareholders.
The business has grown on the back of strong demand for its flagship SharkBite fittings in the North American market as well as the recently acquired Holdrite business.
Reliance Worldwide share were up 0.8% at $3.69 in yesterday’s solid market.
That means the shares are up more than 25% so far this year, outperforming the 4.5% rise in the ASX 200.
