26th Feb 2019 08:46
LONDON (Alliance News) - Shares in chemicals firm Croda International PLC were the second worst performer on the FTSE 100 index Tuesday due to an issue at its new US plant, despite declaring special dividend after profit and revenue rose in 2018.
Shares in Croda were 3.1% lower at 4,903.00 pence on Tuesday.
In 2018, pretax profit widened 1.2% to GBP317.8 million from GBP314.1 million the year prior. This was after revenue fell 1.5% to GBP1.39 billion from GBP1.37 billion.
Croda declared a 115 pence per share special dividend.
The blue-chip firm also proposed a 49.0p per share final dividend, up 6.5% from 46.0p in 2017. For the full year, the dividend rose 7.4% to 87.0p from 81.0p.
"2018 was another year of strong progress for Croda," Chief Executive Officer Steve Foots said. "We are 'Growing the Core' - once again delivering top line growth at industry leading margins to achieve superior returns. We are 'Stretching the Growth', accelerating delivery across our markets through relentless innovation and by investing in disruptive technologies and exciting new growth opportunities."
However, Croda said its US biosurfactants factory - construction of which was its largest capital investment ever - was taken off line in November 2018 after a gasket issue from its construction.
"A thorough investigation is underway and we will bring the plant back on stream in a safe manner later in 2019," Croda explained in a statement. "Until that time, unrecovered operating costs of approximately GBP2 million per quarter are being incurred."
The stopped production of these new "eco" biosurfactants is also expected to result in pressure on any margin gains in 2019.
"Looking ahead, whilst global market conditions remain challenging, we continue to invest for the future and are confident that our strategy of Growing the Core and Stretching the Growth will deliver further progress in 2019," Foots added.
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