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Interim Results

Elementis pre-tax profits fall

02 August 2016 09:43

Elementis posts pre-tax profits of $44.7m for the six months to the end of June - down from $65.3m last time but in line with its recent trading update.

Sales of $334.0m were down from $360.4m and adjusted operating profits fell to $50.7m from $68.6m. The interim dividend is maintained at 2.70c per share.

Group chief executive Paul Waterman said: "In my first six months as chief executive of Elementis I have been impressed by the quality of our people, their dedication to safe, reliable operations and their enthusiasm to provide high quality products and services to our customers. The leadership team has been reorganised into a flatter structure that will support improved engagement, faster decision making and better execution.

"Our headline first half results are somewhat overshadowed by the market downturn in oilfield drilling and the impact of the dollar on Chromium sales outside of North America. However, many of our core strengths, in terms of market position, growth opportunities and margin stability, remain firmly in evidence.

"Specialty Products is a high quality business offering distinctive, value adding products and outstanding technical support to its customers. The operating margin stability that is evident in the first half results is an important indicator of the strong market positions and sustainability of this business.

"Going forward we will focus our attention in a few key areas of the business that have the greatest potential to deliver medium term growth. These include accelerating our innovation pipeline, a more structured approach to key account management, opportunities to further enhance our extensive geographic position in coatings and a review of how we can better resource the many growth opportunities we have in personal care.

"Our strategy for the Chromium business has been well founded, focussing on our structurally advantaged North American business. The recent sharp changes in currencies have highlighted the risks associated with the ROW market and we will continue to seek ways to mitigate this impact.

"Overall, I am excited to be leading a high quality company like Elementis. Its combination of strong market positions, loyal customers and consistent, material cash generation provide the perfect platform to deliver profitable growth and attractive returns to our shareholders."

At 9:43am: (LON:ELM) Elementis PLC share price was -11.75p at 207.75p

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