29th Apr 2020 10:20
(Alliance News) - Specialty chemicals firm Elementis PLC on Wednesday said its first quarter trading was in line with expectations but its outlook has since been clouded, with revenue declining by 15% in April alone.
Elementis reported that its global supply chain held up well in the three months ended March 31.
Performance in the Personal Care unit, which includes cosmetics products, grew "modestly" year-on-year and Coatings improved amid "strong volumes in Asia and the Americas".
"Margins improved materially driven by cost savings, an improved product portfolio and lower raw material costs," Elementis said of Coatings, which supplies additives able to protect against damage and corrosion.
Performance in the Talc unit, which has the paper industry as one of its largest customers, was "broadly in line with the prior year period as robust sales in plastics and coatings were offset by lower ceramics and paper sales".
Energy had a "challenging" start to 2020 amid poor market conditions while chromium sales, though in line with the same period last year, had declining margins.
Elementis added: "Although first quarter trading was in line with expectations with improved profitability, the macro-economic and end-market outlook is highly uncertain and we have seen an approximate 15% year on year decline in April revenue. Given the uncertain environment no specific guidance is provided for the remainder of the year, although we will update as and when visibility improves."
Elementis added that it has stopped all discretionary spend, reduced manufacturing costs and is eyeing further working capital cuts.
Shares in the company were 3.6% higher at 72.80 pence each in London on Wednesday morning.
By Eric Cunha; [email protected]
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