Specialty chemicals company, markets “challenging”
Chief executive officer at Elementis, Paul Waterman, said this week that it expects further progress this year, albeit slightly below expectations, as global market conditions remain "challenging", particularly in the coatings business.
In an update for the three months to the end of March 2019, Elementis said its personal care division had a solid first quarter with strong growth in cosmetics offset by a weaker start in anti-perspirant active ingredients. Bentone Hydroclay, the group's new hectorite-based ingredient focused on the skin care market, launched in the quarter and is building "encouraging" customer momentum.
In the coatings segment, the company said that while price/mix improved, weak demand and some de-stocking, particularly in Asia, caused revenue to decline versus the strong prior year period. Still, early benefits of the transformation programme helped to partially mitigate the profit impact and the programme continues to progress at pace.
Elementis said the integration of the talc business remains on track for completion by October 2019 with a focus on delivering $2m (€1.8m) of identified cost synergies and new business opportunities.
The energy arm had a steady start to the year, with industry infrastructure constraints in North America anticipated to ease in the second half, while chromium sales grew versus the first quarter of last year as improved pricing offset lower demand levels.
The company said some improvement in the demand environment and further cost efficiencies are expected to result in a stronger performance in the second half.
Chief executive officer Paul Waterman said: "Whilst trading conditions in the first quarter of 2019 have proved challenging, Elementis remains focused on delivery, improving returns and deleveraging. This will be underpinned by the integration of the Talc business, delivery of self-help efficiency measures and an unrelenting focus on cash generation."