Profit slump at Elementis

23rd Feb 2010 16:10

Speciality chemicals supplier Elementis reported a sharp fall in underlying profits in 2009 but says that there are initial signs of recovery. Sales fell from £400.5m to £363.7m, while pre-exceptional profit slumped from £48.5m to £18.3m. The revenues would have looked worse had it not been for movements in exchange rates. Exceptional charges soared from £20.5m in 2008 to £49.5m last year. The latest figure includes a £21.6m fine from the EU relating to the heat stabilisers market - which Elementis got out of in 1998. Most of the other exceptional costs relate to restructuring the chromium business, including the closure of the Eaglescliffe plant in the UK. Net debt was £66m at the end of 2009. The total dividend for the year was maintained at 2.9p a share. Chief executive David Dutro says that 2009 provided the most challenging macro economic conditions for decades. The second half was also hit by customer destocking. Dutro says that Elementis has maintained its market share in its main businesses. Elementis has achieved annualised cost savings of £16m and this will help to improve the 2010 figures. There has been some restocking by customers in the early weeks of the year.