Robust demand boosts Croda

The Snaith-based company said group sales rose 2.3 per cent in the three months to September 30, with sales up 4.3 per cent in the first three quarters of its financial year.

The firm said sales growth slowed in the third quarter, reflecting a stronger comparative period last year.

“Nevertheless, growth in our consumer-facing Personal Care and Life Sciences sectors continued,” the group said in a trading update.

However industrial markets were more challenging during the third quarter, which hit the firm’s Performance Technologies division.

Currency translation reduced third quarter reported sales by 0.9 per cent and profit by 1.8 per cent, after the weak euro more than offset a stronger US dollar.

Including the currency effect, third quarter reported sales rose by 1.4 per cent to £262.5m.

“Our focus on innovation continues to support improved sales, with growth of new and protected products well ahead of overall sales,” the firm said.

North America and Asia delivered another strong performance while third quarter sales in Europe remained slightly positive year-on-year.

However Latin America was noticeably weaker, due to difficult macro economic conditions and the impact of local currency devaluation.

Croda said the Personal Care division, which makes chemicals for toiletries, has delivered steady growth over the last five quarters. The division’s third quarter sales rose 2.0 per cent with sales of new and protected products growing at more than twice overall sales.

In skincare, Croda reported good growth in plant-based sales from “IRB by Sederma”, which rose 30 per cent year-on-year on a reported basis.

“Despite cautionary signs in some markets, we are encouraged by continued progress in consumer-facing markets and our successful new and protected products programmes. These, alongside investment in capacity and regional expansion, are expected to drive future performance,” said the firm.

“Based on current rates, currency translation is now likely to have a small negative impact on 2015 sales and profit. In constant currency terms, we remain confident of delivering our expectations for the full year.