Record sales signal Croda turnaround

NATURAL chemicals producer Croda International today announced record sales and pre-tax profits marking a turnaround in its performance.

The Goole-based firm, which supplies some of the world’s best known skincare and cosmetics companies such as L’Oreal, Chanel, Clarins, Estee Lauder and Procter & Gamble, reported a continuing pre-tax profit rise of 31.3% to £31.9m (2008, £24.3m) following a fall in interest costs due to lower borrowings and rates.

For the three months ended September 30 group sales from continuing operations increased 1.1% to £238.1m (2008, £235.4m).

Operating profit from continuing operations increased 23.5% to £34.7m (2008, £28.1m). Year-to-date pre-tax profit has risen 0.8% to £75.5m.

In July, the group reported a 13.8% slump in pre-tax profits for the six months ended June 30 to £43.6m.

The month before Croda announced the closure of its Teesside plant with the loss of up to 125 jobs. Previously it had confirmed that its Merseyside plant was to close.

Croda said today that its strong third quarter performance had been helped “significantly” by an impressive improvement in its industrial specialities division.

It said that although overall volumes remained down on last year severe destocking practice appeared to have come to an end.

Industrial specialities has been trading profitably for four months with a steadily improving trend in both volumes and profitability.

Consumer care has continued to trade robustly with double digit increases in sales and operating profit and improved margins versus the corresponding quarter in 2008.

“Croda’s robust and efficient business model, together with the steps we have taken to reduce costs, has enabled the group to overcome tough market conditions,” it said in a statement.

“We are confident of making further progress, both in the rest of the current year and in 2010.”