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The Markets
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Chemicals

Elementis financial results note “strategic progress” amid challenging markets

It comes after January's profit warning, triggered by deterioration in two "cyclically exposed" business units.

Elementis plc (LON:ELM) chief executive Paul Waterman described 2019 as “a year of material strategic progress” as the chemicals firm confirmed growth in its statutory financials, but profits in continuing operations narrowed.

It comes after January’s profit warning which flagged the impacts of lower chromium prices and a slow down in US oil activity.

Revenue for the year amounted to US$874mln, up 6%, supported by the acquisition of Talc but otherwise was challenged by negative market conditions.

Statutory operating profit increased by 19% to total US$101mln and statutory profit was 11% higher reported at US$46mln.

Adjusted for continuing operations operating profit was marked at US$123mln, down 7%, and adjusted pre-tax profit came in at US$94mln, down 17%.

READ: Elementis warns on profits

Net debt reduced by 9% to US$454mln.

"2019 was a year of material strategic progress for Elementis,” Waterman said.

“Market trading conditions were challenging, with a notable deterioration in our two most cyclically exposed businesses, Chromium and Energy, along with ongoing competitive pressure in AP Actives.

“Nonetheless, our self help actions on cost savings and new business initiatives have helped to protect profits and margins.”

He added: “Over the last three years, Elementis has been re-positioned as a premium performance additives company with advantaged positions in growing markets.

“We are excited about the potential for material growth opportunities, margin improvement and strong cash generation."

Dividend for the year amounted to 8.55 cents per share, up 2%.

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