23 July 2013 11:29 [Source: ICIS news]
LONDON (ICIS)--Croda International’s second-quarter operating profit from continuing operations rose by 4.4% year on year to £71.1m ($109.4m, €82.7m) on the back of “improving trends in key markets”, the UK-based specialty chemicals company said on Tuesday.
Gains were reported across each of the company’s three reporting segments – consumer care, performance technologies and industrial chemicals – and sales rose by 2.3% during the period compared to the second quarter of 2012, to £279.6m, the company added.
“Although the challenging trading environment has inevitably held back certain parts of the business, our leading positions in niche markets and steadfast commitment to innovation are reflected in improved profits and margins in all three business divisions,” said CEO Martin Flower.
According to Croda, the chemicals market remained challenging during the first six months of the year, but declines in European demand across most sectors “with the exception of the automotive sector” began to moderate towards the end of the first half.
Demand held up well in North America, the company added, bolstered by strong growth in Latin America, but sales declined by 16.2% across eastern Europe, the Middle East and Africa, with falls reported across most business areas.
Total group profits for the consumer care division increased by 2.9% during the quarter to £49.8m despite weak crop care sales as a result of a late start to the corn-growing season in Europe and North America. Performance technologies profits increased by 8.2% year on year to £18.4m, with growth weighed down by the division’s exposure to the European automotive market.
Operating profit for the industrial chemicals division grew by 7.4% to £2.9m, due to improved performance following the divestment of Cremona, the company’s last commodity chemicals business, in late 2012. Over half the business is now made up of specialty chemicals, Croda added.
Investment bank JP Morgan Cazenove welcomed the results, calling Croda “a havem for stability in increasingly stormy seas” in an analyst note.
($1 = €0.76, €1 = £0.86, $1 = £0.65)
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