Helsinki, July 18 - Packaging maker Huhtamaki said it expects operating profit to fall 10-15 percent this year, due to high raw material costs and slowing consumer spending, and plans to raise prices.
The world's top ice-cream and fast-food packaging maker quantified its outlook after it posted a drop in second-quarter profit on Friday.
Huhtamaki had previously said it expected 2008 underlying operating profit below the 2007 level, without giving a figure.
Its shares were down 1.8 percent at 5.4 euros by 1231 GMT.
Chief Executive Jukka Moisio said in a conference call with investors: "We believe the full-year EBIT before restructuring charges will be approximately 10 to 15 percent below 136 million (euros) which was underlying EBIT last year."
Huhtamaki said higher input costs have hurt it. "The raw material costs remained on a high level throughout the reporting period and increases in energy and distribution costs became more pronounced in the second quarter."
The firm planned to increase prices of its products, Huhtamaki Chief Financial Officer Timo Salonen said on the conference call.
Demand for consumer packaging has remained stable or improved in most markets, but Europe is starting to show signs of slowing demand, the firm said.
Earlier Friday, Huhtamaki posted a fall in second-quarter operating profit to 27 million euros ($42.8 million) from 35.7 million a year ago and below the 29 million average forecast in a Reuters poll of 10 analysts.
The firm booked 6.8 million euros in restructuring charges in the second quarter.
"The results were close to what I expected, there was nothing surprising," Pohjola Bank analyst Mikael Nummela said.
Huhtamaki sales in the quarter fell 3 percent year-on-year, slightly more than expected, to 591 million euros. Sales in constant currencies rose slightly, the firm said.