Chemicals group finds formula for sales growth

Sales surged almost 19 per cent to 255.3m in the three months to the end of September and pre-tax profits, aided by lower debt, rocketed 56.8 per cent to 47.5m. That was despite the third-quarter normally being a quieter trading period for the Goole-based company.

So far this year, pre-tax profits from continuing operations are up 87.6 per cent at 143.7m.

Chairman Martin Flower said: "I am pleased to report continued strong progress in the third quarter, driven by significant sales growth building on a robust 2009 performance. Croda continues to trade strongly and we expect to report further year-on-year progress in the final quarter of 2010 and into 2011."

Consumer care saw a 15.4 sales increase and operating profits up 32.5 per cent, with crop care delivering a particularly strong performance. Its industrial specialities saw a marked improvement with sales and profits up 22.1 per cent and 89.4 per cent respectively.

So far this year the group has cut net debt by 47.8m, leaving the figure at 240.7m.

However, shares in the company appeared to run out of steam yesterday after a strong year. Shares closed down almost three per cent at 1,470p.

Brewin Dolphin stockbrokers trimmed its rating to "hold" from "add" with analysts saying: "Croda's third-quarter results this morning are strong, combining the benefit of resilient volumes (the seasonal summer slowdown appears to have been slightly less marked than expected) and the price increases implemented by the group early in the period to combat input cost pressures."