Chemical company reports sales increases
A speciality chemical company has today reported continued organic growth and has its sights set on further growth in the US, Asia and Europe.
Croda International, based in Goole, creates high performance ingredients and technologies globally and has today released a third quarter trading update. In reported currency, its Q3 group sales grew 6.1% to £334.6m, from £315.3m last year, including a 1.7% benefit from currency translation.
Year-to-date sales were 12.8% higher, including a currency translation benefit of 8.8%. Q3 profit margin increased slightly over prior year, which the firm said was reflecting improved product mix and pricing, with a successful focus on growing value ahead of volume.
It said that the improved sales trend seen in the first half of 2017 continued through Q3, with Group constant currency sales up 4.4% in the quarter and 4% year-to-date. Across the three core sectors, constant currency sales in Q3 grew 5.7% – up 4.8% year-to-date.
Steve Foots, chief executive, said: “We continue successfully to deliver on our priorities for 2017 – driving profitability through premium, faster growth market niches; improving performance in less differentiated markets; and making progress towards our target increases in return on sales in Life Sciences and Performance Technologies. The combination of good top line growth and margin in Q3 gives us confidence in delivering our expectations for the full year.”
The firm said this was driven by a strengthening performance in personal care, with constant currency sales up 7.5%, building on the recovery seen in the first half of the year; performance technologies recorded another robust performance, with sales up 7%; and life sciences achieved modest sales growth, up 0.7%.
Action was taken to restore growth to North America, with sales up 8% in the quarter. Asia maintained its strong momentum, growing sales by 6%, reflecting the benefits of increased proximity to local and regional customers following the transfer of distributor sales to our direct selling model.
Sales in Europe grew by 7%, due to demand in personal care. Macro-economic conditions in Latin America remained challenging, with sales 2% lower, although there are some signs of improvement emerging.
Croda’s balance sheet remains robust, with net debt at the end of Q3 broadly unchanged from the half year. Capital investment is at its peak as the firm looks to confirm an innovative North American bio-surfactants plant is expected to commission towards the end of the year.
