24th Apr 2014 08:27
LONDON (Alliance News) - Croda International saw its shares drop in early trading Thursday after the company reported a 3.2% decline in revenue for the first quarter and pretax profit took a hit from adverse currency translation.
In an interim management statement for the period since December 31, 2013, Croda said pretax profit saw a marginal increase, up to GBP65.2 million from the GBP65.1 million recorded last year.
The FTSE 250-listed company said revenue fell 3.2% to GBP274.0 million from GBP283.1 million last year, hit by adverse currency translation of 6.1% dragging reported sales in sterling lower. On a constant currency basis, group revenue was up 2.9% with acquisitions contributing 1.6% to this total, said Croda.
On a divisional basis, Croda's Industrial Chemicals business performed well, with revenue up 3.3% to GBP31.8 million from GPB30.8 million last year. Revenue in Consumer Care and Performance Technologies declined 6.3% and 0.1%, respectively, to GBP148.4 million and GBP93.8 million from GBP158.4 million and GBP93.9 million, respectively.
The company said the mixed results follow disruption caused by the severe weather in North America and difficult economic conditions in South America. Crop Care was impacted by heavy snow in North America during January and February and weak sales into Eastern Europe. Weak sales in North America and challenging economic conditions in South America were the main drivers behind modest underlying sales declines in Personal Care. Health Care growth was strong in almost all geographies. A further 0.5% contribution to sales growth came from acquisitions.
Croda also said business in Asia was particularly strong and all business areas apart from Home Care saw good sales growth.
Looking ahead, the company expects the modest improvement in underlying sales growth seen in the first quarter to continue. However, Croda said adverse currency translation is expected to remain an issue and consequently, second quarter performance is likely to be similar to that seen in the first quarter.
Shares in Croda plummeted in early trading, the stock sits as the third biggest faller on the FTSE 250 Thursday, trading down 1.33% at 2,546.5609 pence per share.
By Alice Attwood; [email protected]; @AliceAtAlliance
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