Elementis Reports Modest Revenue Growth in Third Quarter
LONDON - Elementis plc, a global specialty chemicals company, reported a slight 2% year-on-year increase in revenue for the third quarter ending September 30, 2024. When adjusted for foreign exchange fluctuations, the increase stands at 3%. The company's adjusted operating profit margin remained stable at 17%, consistent with the first half of the year.
Revenue growth was observed in both business segments. Personal Care sales grew in the Cosmetics and AP Active Ingredients areas, following typical seasonal trends. Performance Specialties also had a positive third quarter, with favorable pricing and product mix offsetting the decline in overall market volumes.
In the Coatings sector, Elementis achieved a marginal sales increase compared to last year. The Americas and EMEA regions contributed to revenue growth through price and mix improvements, despite lower sales volumes in Asia. Meanwhile, Talk sales remained relatively unchanged year-on-year as the company focused on high-value applications.
Elementis continues to implement its Innovation, Growth, and Efficiency strategy, having launched seven new products and maintained its cost-saving initiatives. The company is on track to achieve at least $15 million in annual cost savings for 2024. The Future Ready restructuring program is progressing as planned, with the transfer of operational services to an external provider completed and the development of a new center in Porto underway.
Regarding the EU state aid case, Elementis expects the reimbursement of approximately £15 million following the cancellation of a previous ruling by the Court of Justice of the European Union that some UK tax exemptions conflicted with EU state aid rules.
The strategic review of the Talk business, announced on August 1, 2024, is ongoing, with further updates promised in the future. In light of the European Chemicals Agency's Risk Assessment Committee's proposal to reclassify talc as a substance of very high concern, Elementis plans to appeal the proposed classification alongside EUROTALC.
CEO Paul Waterman expressed satisfaction with the company's third-quarter performance, emphasizing confidence in the execution of the company strategy and the fulfillment of full-year financial expectations. Elementis will continue to focus on self-help strategies to ensure financial targets are met regardless of market conditions.
Elementis' financial outlook remains positive, with expectations to deliver full-year financial performance aligned with market projections and continue to reduce leverage ratios. The information provided is based on Elementis' press release.