14th Jan 2020 08:17
(Alliance News) - Elementis PLC said Tuesday it expects to report a drop in adjusted operating profit for 2019 following a subdued trading performance in the last quarter.
For the year, the FTSE 250 specialty chemicals firm expects adjusted operating profit to be between USD122 million to USD124 million, a 6.8% to 8.2% decline from GBP133 million in 2018.
Shares in Elementis - which is based in London - were 13% lower at 142.98 pence on Tuesday.
The Personal Care segment had a mixed end to the year, as a solid performance in cosmetics offset competitive pressures in AP Actives.
The Energy unit performed weaker due to a slowdown in North American drilling activity, Elementis said, as did the Chromium segment as a result of a weak demand environment and lower market prices.
However, Coatings performed well as demand conditions remains in line with expectations, it said, and Talc was buoyed by solid demand for industrial talc and new business.
"Our overall performance in 2019 has been negatively impacted by a challenging market backdrop as the more cyclically exposed parts of the portfolio like Chromium and Energy have deteriorated through the second half. However, as outlined at the recent Capital Markets Day, our priorities going forward are clear," said Chief Executive Officer Paul Waterman.
"We remain committed to delivering our medium-term group performance objectives of a 17% operating profit margin, operating cash conversion of at least 90% per annum and financial leverage of under 1.5x Ebitda, with further reduction thereafter," Waterman added.
By Dayo Laniyan; [email protected]
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