Why Croda in Snaith has seen its pre-tax profit drop to £322.1m

Speciality chemical company Croda International said it delivered a resilient performance in 2019 despite seeing profit and sales drop in subdued market conditions.
Croda CEO Steve Foots.Croda CEO Steve Foots.
Croda CEO Steve Foots.

The Snaith-based saw pre-tax profit fall by 3.7 per cent on a constant currency basis from £331.5m to £322.1m in the year ended December 31, 2019. While core business sales were down 2.3 per cent in the same period.

Steve Foots, CEO of Croda, said: “In 2019, we delivered a resilient performance with a strong margin maintained and increased cash flow, despite subdued market conditions.

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“This is testament to Croda’s focused strategy and strong business model.”

The FTSE 100 company, which counts Unilever, Procter & Gamble and L’Oreal as customers, hailed the performance in its life sciences division as excellent, driven by the strength of of its health care and crop protection platforms.

Mr Foots said: “An excellent performance in life sciences was reflected in sales growth and margin improvement.

“Sales in personal care were significantly impacted by a slower US market and by new legislation in China, but conditions improved in line with our expectations in the final quarter, and sector profitability increased further.

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“Performance technologies slowed in line with the wider sector, due to weak industrial demand.

“In the year ahead, subject to trading conditions remaining similar, we expect to make further progress in our consumer markets, whilst demand in industrial markets is expected to remain weak but stable. Our growth will be second half weighted.

“With our new Purpose, Smart Science to Improve Lives, we will continue to increase the positive impact our products deliver for our customers and their consumers.

“We will also reduce the negative impact our activities have on our fragile world. The combination of a healthy innovation pipeline, recent investments, cost saving benefits and a robust business model is expected to underpin performance.”

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