Elementis profits grow in Q1

(Sharecast News) - Chemicals business Elementis said on Tuesday that both profit growth and margin improvement were in line with expectations during a "solid" Q1. Elementis said it had delivered a strong performance despite a "weak global demand environment", with adjusted operating profit and margins both ahead of Q1 FY2024, driven by continued progress of its self-help initiatives, including pricing.

Personal care sales in the quarter were marginally up on a constant currency basis, while cosmetics were broadly flat despite soft demand in Asia and a weaker mix. Performance specialties sales, on the other hand, were "modestly lower" on a constant currency basis compared to Q1 last year.

The FTSE 250-listed group also noted that cash generation in the first quarter was in line with expectations.

Chief executive Luc van Ravenstein said: "We have delivered a solid performance with growth in profitability and margins in what has been a challenging demand environment. Looking ahead, we are well positioned to manage the potential impacts of the recent US tariffs due to our global multi-site manufacturing footprint. However, the future demand impacts are highly uncertain. To help mitigate this, we are making strong progress with our self-help actions, and are on-track to achieve our target of $12m savings this year, with additional savings opportunities being identified. Whilst we are mindful of the increased economic uncertainty associated with tariffs, our expectations for the full year are unchanged."

Looking ahead, van Ravenstein added that Elementis was continuing to make "good progress" towards its 2026 goals and was building on its "strong foundations" to take the business "to the next level".

As of 0850 BST, Elementis shares were up 0.78% at 129.40p.

Reporting by Iain Gilbert at Sharecast.com