17 February 2009 11:28 [Source: ICIS news]
LONDON (ICIS news)--Croda has posted an 11% increase in fourth-quarter continuing pre-tax profit to £20.9m ($29.8m, €23.2m), up from £18.8m in the same period a year earlier, the UK oleochemicals company said on Tuesday.
Continuing sales rose 8% year on year to £221m in the fourth quarter, which was driven by the consumer care segment, Croda said.
By business segment, Croda said the consumer care increased its continuing operating profit by 18% to £24m, while sales were up 46% to £113.9m.
The industrial specialties segment’s performance lagged behind, with continuing operating profit dropping to £0.8m in the fourth quarter from £3.3m in the same period in 2007. Sales dropped 16% to £107m.
Croda said the group achieved record sales and profits for the full year of 2008, despite steeply rising raw materials costs in the first half and weak industrial markets in the second.
Full-year profit before tax was up 78% to £98.4m, while sales increased by 19% to £956.4m.
“The group’s ability to weather turbulent economic conditions and produce record sales and profits demonstrates the robustness of the underlying business and the continuing resilience of our chosen market sectors,” said Croda chairman Martin Flower.
“We have started 2009 in line with expectations. The broad trading trends of resilient Consumer Care demand, weaker industrial markets and favourable currency translation are continuing. We are confident of making further progress in the year ahead,” he added.
Commenting on the announcement, investment bank Cazenove said trading had held up well at the close of 2008 with good demand and buoyant pricing.
“From here, however, we suspect that customer markets will come under more pressure as consumer demand weakens,” said analyst Martin Evans in a note to investors.
“A more difficult year is likely, although in terms of structural growth Croda remains in the right area, while sterling weakness will help translation,” he added.
With its full-year profit before tax of £98.4m, Croda beat the consensus analyst forecast of £97.7m, but the market reacted negatively to the results.
By 10:25 GMT, the company’s shares had dropped by over 4% from Monday’s close at 501 pence.
($1 = €0.78/$1 = £0.70)
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