Trading Statement

    RNS Number : 7137H
  FoaMasters International Limited
  07 November 2008
   

 For Immediate Release  7 November 2008

    

    FoaMasters International Limited

    ("FoaMasters" or "the Company" or "the Group")

    Trading Statement

    FoaMasters International Limited (AIM:FOAM), the pre-dominantly China based manufacturer of premium foam products, provides the
following update to shareholders on the Group's current trading.

    Since the end of the first half of 2008, overall demand for raw foam and finished products has weakened. However, demand for bedding
products continued to be strong and for the third quarter remained at a similar level to that in the second quarter. FoaMasters' trading
environment continues to be impacted by raw material pricing volatility which has affected gross margins.  Whilst the volatility in raw
material prices is expected to continue over the next 12 months, the Group will focus on cost management and the passing on of cost
increases to customers where appropriate in the near term. 

    Although the business remains profitable, trading conditions nevertheless are challenging. The Board believes that, under the current
trading environment, whilst FoaMasters will remain profitable this year, its results for the year to 31 December 2008 will be below previous
expectations.

    FoaMasters' management continues to review the Group's overall cost base and business strategies with a view to taking advantage of the
current weak trading conditions which have adversely affected its competitors. It has put in place certain measures including stringent
customer credit control and just-in-time raw material purchase policies to cautiously expand its market share and improve its profitability
moving forward.

    Against the current background, the Board remains confident that the fundamentals of the Group remain strong and that the strategies in
place combined with the Group's market leading position in the industry will result in continued long-term growth for FoaMasters.

    Mr. Jack Cheong, CEO of FoaMasters, commented:

    "FoaMasters continues to contend with challenging trading conditions, together with raw material price fluctuations. Nevertheless, we
continue with the Group's strategy to focus on higher margin products and those with an environmental focus to improve profitability and we
remain optimistic for the long term prospects of the Group"

    For further information please contact: 

 FoaMasters International Limited                               +852 2887 7361
 Jack Cheong, Chief Executive Officer
 Richard Cheong, Deputy Chief Executive Officer 
 Teh Kim Seng, Non-executive Chairman   

 Hanson Westhouse Limited                                     +44 20 7601 6100
 Tim Metcalfe
 Anita Ghanekar

 Buchanan Communications                                      +44 20 7466 5000
 Ben Willey                                               benw@buchanan.uk.com
 Jennie Spivey


This information is provided by RNS
The company news service from the London Stock Exchange
 
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