REG - Elementis PLC - AGM Trading Statement

ElementisAnnouncement

26/04/2022 07:00

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RNS Number : 2756J  Elementis PLC  26 April 2022

Elementis plc

AGM Trading Statement

 

Robust first quarter trading performance

 

Chromium strategic review

 

Elementis plc ("Elementis" or the "Group"), a global specialty chemicals
company, today issues a trading update for the three months ended 31 March
2022 and announces a strategic review of Chromium.

First Quarter Business Performance

 

Trading for the three months ended 31 March 2022 has been positive. Revenue
increased approximately 7% on an underlying basis* against the prior year
period, driven by pricing actions, new business wins and continued demand
recovery in Personal Care.

·      Coatings revenue and margins increased on the prior year period.
Successful pricing actions and an improved mix more than offset lower volumes
linked to supply chain disruptions and weaker industrial activity in China, as
well as rising raw material, energy and logistics cost inflation.

 

·      Personal Care performance improved materially as social
restrictions eased further and our growth initiatives continued to gain
momentum. Margins were strong due to successful pricing actions. The ramp-up
of our new plant in India continues to progress at pace.

 

·      In Talc, while successful pricing actions more than offset cost
inflation, performance declined on the prior year period due to weaker
European automotive production and a strike throughout the first quarter at
our main paper customer in Finland.

 

·      Chromium performance declined as an unexpected temporary plant
outage impacted volumes. Pricing continued to show positive momentum, more
than offsetting increased costs.

 

Cash generation in the first quarter was in line with expectations and the
Group's business model remains highly cash generative.

 

Strategic Update

 

The Group today announces it has initiated a strategic review of its Chromium
business. The review will establish whether the full potential of Chromium can
best be delivered as part of Elementis, or, via a full or partial divestment.
It will consider the practicality of all options, whilst prioritising the best
interests of all stakeholders, including employees, customers and
shareholders.

 

Outlook

 

The year has started well with improved profitability, driven by self-help
actions, positive momentum in Personal Care and underlying strength in
Coatings. For the full year, we are confident that further strategic progress
will drive improved financial performance and a reduction in leverage, in line
with expectations.

 

Commenting on today's announcement, CEO, Paul Waterman said,

 

"We have made a good start to the year and will continue to maintain our focus
on self-help actions and effectively managing the challenging external supply
chain environment, demand uncertainties and rising inflation. We remain
on-track to deliver $50m of new business opportunities, over 20 new products
and progress towards $10m of additional efficiency savings by 2023.

 

In line with our Innovation, Growth and Efficiency strategy, we have focused
Elementis on high quality Personal Care, Coatings and Talc performance
additive businesses which hold enduring positions of strength in growing
markets, and today represent approximately 90% of Group profits. In this
context we will execute a strategic review of our Chromium business to
determine whether Elementis remains the best owner."

 

Enquiries

Elementis

James Curran, Investor Relations                  020 7067
2994

Tulchan

Martin
Robinson                                             020
7353 4200

Olivia Peters

 

Notes: Adjusted for constant currency impact

 

 

 

 

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