Croda first-quarter sales up 7.7%; outlook reaffirmed

Croda International reported a rise in first-quarter sales and reaffirmed its outlook for the full year amid continued growth in the group’s core businesses.

The FTSE 250 company, which manufactures speciality chemical ingredients, said sales rose 7.7% in the first quarter to the end of March to £306.8m, with seed treatment business Incotec adding 4.7% to group sales in its first quarter since acquisition.

At the same time, favourable currency translation lifted reported sales by 3.9%, reflecting the impact of the stronger euro and US dollar.

In the core business, Asia saw strong growth, with underlying sales up 7.2%.

Europe also continued to deliver steady growth, with underlying sales 2.7% higher, but underlying sales in North America fell 1.8%.

Croda said export customers have been impacted by the strong dollar and it has seen US customers relocate manufacturing overseas.

Volume in Latin America remained weak due to difficult macroeconomic conditions, and sales, whilst up strongly in local currency, were 11.5% weaker on an underlying basis.

The company also said profit growth in the first quarter was in line with its expectations and operating margin rose 60 basis points thanks to a good performance in consumer markets, successful innovation reflected in new and protected products growth in all sectors, growth with regional and local customers, and improved mix within the product portfolio.