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Croda International (CRDA)

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Wednesday 28 July, 2004

Croda International

Interim Results

Croda International PLC
28 July 2004


Wednesday, 28 July 2004

                            Croda International Plc
                          Interim Results Announcement
                           Six months to 30 June 2004


Highlights

          Strong demand in first six months continues into second half

                                                                          2004            2003

Sales for continuing operations                                        £146.5m         £142.6m       + 2.7%

Constant currency sales for continuing operations                      £156.4m         £142.6m       + 9.7%

Pre-tax profit before exceptional items for
  continuing operations                                                 £22.5m          £20.5m       + 9.8%

Profit before taxation                                                  £19.8m          £20.1m       - 1.5%

Earnings per share - before exceptional items                            11.0p           10.0p      + 10.0%

Earnings per share - basic                                                8.7p           10.0p      - 13.0%

Dividend per share                                                        4.1p           4.02p       + 2.0%


•         Constant currency sales for continuing operations up by almost 10%
•         Oleochemicals trading margin raised to 17.7% (2003 17.3%)
•         Net debt reduced by over £8m to £20.4m
•         Interim dividend increased by 2% to 4.1p per share
•         Ongoing demand good and product pipeline strong

Commenting on the results, Chairman, Antony Beevor, said:

'Sales from our continuing operations grew by almost 10% in constant currency
terms driven by an increase in sales to the Personal and Health Care markets of
14%.  Improvements in mix, and a number of new product launches by our Personal
Care customers helped to deliver a trading margin of 17.7% for our Oleochemicals
business.

Demand in the first half year in our core markets has been strong.  As we start
the second half, underlying demand continues to be firm.  We are planning
further product launches in the second half and are maintaining good control of
costs.  As a result we believe 2004 will be a year of further progress for the
Group.'


For further information, please contact:

Mike Humphrey, Chief Executive                              Tel:   01405 860551
Barbara Richmond, Group Finance Director                    Tel:   01405 860551
Charlie Armitstead or Andrew Dowler, Financial Dynamics     Tel:   0207 831 3113


Or visit our web site at:  www.croda.com where the presentation to analysts will
be available by midday today.



                            Croda International Plc


                              Chairman's Statement


Profit before tax of £22.5m from continuing operations before exceptional items
for the first half year was 9.8% ahead of the same period last year.

In the first six months, reported sales from continuing operations were up 2.7%
on last year.  In constant currency they were up by 9.7%.  This growth in sales,
combined with improved product mix, resulted in the strong improvement in
pre-tax profit.

The tax rate of 35.4% was similar to last year, giving earnings per share (EPS)
excluding exceptional items of 11.0p, a 10% increase on the 10.0p for the same
period last year (basic EPS 8.7p compared to 10.0p in 2003).  In line with our
stated policy of increasing our dividend cover over the next few years to two
times, the Board has declared an interim dividend of 4.1p (2003 4.02p), payable
to shareholders on 6 January 2005.

Trading

As I reported at the time of the Annual General Meeting in April, the year
started very well.  Demand remained good in the second quarter.  Sales in our
Oleochemicals business grew 10% in constant currency, reduced to 3% in Sterling
terms due to the weakness of the US Dollar and the Euro.  Improvements in mix,
helped by a number of new product launches by our Personal Care customers, and
price increases delivered a trading margin of 17.7% (2003 17.3%) in the core
Oleochemical business despite the negative effects of currency and higher raw
material prices.

Sales in Personal and Health Care continue to be the driver of growth with a
rise in constant currency of 14% and in Sterling terms of almost 7%.  Sales in
the Home Care and Plastics Additives segment fell due to our withdrawal, in the
second quarter of last year, from some lower margin commodity business.

Sales in our Other businesses declined slightly as we continue to reposition the
business into lower volume, higher added value areas.  As a consequence trading
profits in these businesses rose significantly in the first half.

Restructuring

Following the sale in January 2004 of our Fire Fighting Chemicals business, I am
pleased to announce that earlier this month a small, 60% owned, subsidiary in
Australia sold its business manufacturing rock anchors.  The results of this
business have been included in discontinued operations.

Finance

In the first half year we spent just under £9m on capital investment in our
continuing operations.  We received the proceeds from the sale of a number of
surplus sites, as well as the Fire Fighting Chemicals business.  As a result our
net debt fell by £8.6m to £20.4m, giving gearing of 12% (2003 28%).

Outlook

Underlying demand in July continues to be firm.  We are planning further product
launches for the second half of this year and are maintaining good control of
costs.  As a result we believe 2004 will be a year of further progress for the
Group.


Croda International Plc
Results for the six months ended 30 June 2004

Group profit and loss account

Unaudited £m                                                           2004            2003            2003
                                                                      First           First            Full
                                                                       half            half            Year

Turnover
Continuing operations                                                 146.5           142.6           279.8
Discontinued operations                                                 2.9            11.5            23.6
                                                                     ______          ______          ______
                                                                      149.4           154.1           303.4
                                                                     ______          ______          ______
Operating profit
Continuing operations                                                  23.7            22.2            41.8
Discontinued operations                                               (0.2)           (0.4)           (0.2)
                                                                     ______          ______          ______
                                                                       23.5            21.8            41.6
Exceptional items                                                     (2.5)               -             4.3
Net interest payable                                                  (1.2)           (1.7)           (2.9)
                                                                     ______          ______          ______
Profit before taxation                                                 19.8            20.1            43.0

UK taxation                                                           (1.2)           (1.0)           (2.9)
Overseas taxation                                                     (6.7)           (6.1)          (10.8)
Tax on exceptional items                                              (0.3)               -               -
                                                                     ______          ______          ______
Profit after taxation                                                  11.6            13.0            29.3
Minority interests and
  preference dividends                                                (0.2)               -               -
                                                                     ______          ______          ______
Profit attributable to ordinary
  shareholders                                                         11.4            13.0            29.3
Ordinary dividends                                                    (5.4)           (5.2)          (15.5)
                                                                     ______          ______          ______
Reserves transfer                                                       6.0             7.8            13.8
                                                                     ______          ______          ______


                                                                  pence per       pence per       pence per
                                                                      share           share           share
Earnings per share of 10p
Basic                                                                   8.7            10.0            22.5
Basic before exceptional items                                         11.0            10.0            19.2

Diluted                                                                 8.7            10.0            22.4
Diluted before exceptional items                                       11.0            10.0            19.1

Ordinary dividends
Interim                                                                4.10            4.02            4.02
Final                                                                                                  7.83


Summarised balance sheet

Unaudited £m                                                           At              At                At
                                                                  30 June         30 June       31 December
                                                                     2004            2003              2003

Fixed Assets                                                        147.2           155.0             150.3
Stock                                                                52.1            52.7              51.8
Debtors                                                              92.5            97.4              90.4
Cash at bank and in hand                                             28.2            29.6              27.8
Creditors falling due within one year                              (83.9)         (101.1)            (86.9)
Creditors falling due after one year                               (31.5)          (44.8)            (37.6)
Provisions for liabilities and charges                             (32.2)          (31.7)            (32.2)
                                                                   ______          ______            ______
                                                                    172.4           157.1             163.6
                                                                   ______          ______            ______


Shareholders' funds                                                 171.2           155.9             162.4
Minority Interests                                                    1.2             1.2               1.2
                                                                   ______          ______            ______
                                                                    172.4           157.1             163.6
                                                                   ______          ______            ______



Movement in shareholders' funds

Unaudited £m                                                         2004            2003            2003
                                                                    First           First            Year
                                                                     Half            Half

Profit attributable to ordinary shareholders                         11.4            13.0            29.3
Ordinary dividends                                                  (5.4)           (5.2)          (15.5)
Goodwill written back                                                 3.4               -               -
Currency translation differences                                    (1.6)             1.3             1.4
Transactions in own shares                                            1.0           (0.6)           (0.2)
                                                                   ______          ______           _____
Net movement in shareholders' funds                                   8.8             8.5            15.0
Opening shareholders' funds                                         162.4           147.4           147.4
                                                                   ______          ______          ______
Closing shareholders' funds                                         171.2           155.9           162.4
                                                                   ______          ______          ______



Note

There have been no recognised gains or losses, other than those detailed above,
since 31 December 2003.


Summarised cash flow

Unaudited £m                                                           2004             2003             2003
                                                                      First            First             Year
                                                                       Half             Half

Operating profit                                                       23.5             21.8             41.6
Depreciation and goodwill amortisation                                  7.4              7.4             15.1
Working capital movement                                              (4.4)              0.3              3.6
Other                                                                 (2.1)            (3.8)            (1.4)
                                                                      _____            _____            _____
Operating cash flow                                                    24.4             25.7             58.9
Interest                                                              (1.2)            (1.7)            (2.8)
Dividends                                                             (5.3)            (5.1)           (15.1)
Taxation                                                              (7.3)            (7.0)           (12.2)
Fixed assets purchased                                                (8.9)            (4.4)           (12.3)
Sales of fixed assets                                                   2.2              1.7              4.9
Disposals                                                               4.4                -                -
Other                                                                 (0.5)            (1.5)            (1.2)
                                                                      _____            _____            _____
Cash flow before use of liquid resources
   and financing                                                        7.8              7.7             20.2
Management of liquid resources and
   financing                                                          (4.3)           (15.8)           (20.6)
                                                                      _____            _____            _____
Movement in cash                                                        3.5            (8.1)            (0.4)
                                                                      _____            _____            _____

Reconciliation of net debt
Movement in cash                                                        3.5            (8.1)            (0.4)
Movement in debt and lease financing                                    5.2             15.2             20.5
                                                                      _____            _____            _____
Change in net debt from cash flows                                      8.7              7.1             20.1
New finance lease contracts                                               -                -            (0.1)
Exchange differences                                                  (0.1)              1.3              3.1
                                                                      _____            _____            _____
Movement in net debt in the period                                      8.6              8.4             23.1
Net debt brought forward                                             (29.0)           (52.1)           (52.1)
                                                                      _____            _____            _____
Net debt carried forward                                             (20.4)           (43.7)           (29.0)
                                                                      _____            _____            _____



Exceptional items

Unaudited £m                                                           2004             2003             2003
                                                                      First            First             Year
                                                                       Half             Half

Loss on disposal of discontinued operations
Loss on disposal                                                      (0.4)                -              1.2
Goodwill written back                                                 (3.4)                -                -
                                                                      _____            _____            _____
                                                                      (3.8)                -              1.2
Profit on disposal of fixed assets in
   discontinued operations                                              1.3                -              3.1
                                                                      _____            _____            _____
                                                                      (2.5)                -              4.3
                                                                      _____            _____            _____


Segmental analysis of continuing operations

Unaudited £m                                                           2004             2003             2003
                                                                      First            First             Year
                                                                       Half             Half

Turnover by business sector

Oleochemicals                                                         137.6            133.3            261.6
Other                                                                   8.9              9.3             18.2
                                                                     ______           ______           ______
                                                                      146.5            142.6            279.8
                                                                     ______           ______           ______

Trading profit

Oleochemicals                                                          24.3             23.1             44.0
Other                                                                   1.9              1.5              2.2
                                                                     ______           ______           ______
                                                                       26.2             24.6             46.2
Central costs                                                         (2.5)            (2.4)            (4.4)
                                                                     ______           ______           ______
                                                                       23.7             22.2             41.8
                                                                     ______           ______           ______

Turnover by geographical destination

United Kingdom                                                         23.1             22.3             43.7
Rest of Europe                                                         46.5             45.9             88.0
Americas                                                               47.2             45.6             89.3
Asia                                                                   20.0             18.4             37.1
Rest of World                                                           9.7             10.4             21.7
                                                                     ______           ______           ______
                                                                      146.5            142.6            279.8
                                                                     ______           ______           ______

Turnover by market sector

Personal and Health Care                                               89.5             83.7            164.5
Home Care and Plastics Additives                                       19.4             21.5             39.9
Industrial Specialities                                                28.7             28.1             57.2
Other                                                                   8.9              9.3             18.2
                                                                     ______           ______           ______
                                                                      146.5            142.6            279.8
                                                                     ______           ______           ______




Notes to the interim report

1.   The interim dividend of 4.1p will be paid on 6 January 2005 to shareholders 
     registered on 3 December 2004.

2.   The interim financial information has been prepared on the basis of the
     accounting policies set out in the Group's 2003 statutory accounts.

3.   The financial information for the year ended 31 December 2003 is abridged.  
     Full accounts for that year, on which the Auditors of the Company made an 
     unqualified report, have been delivered to the Registrar of Companies.

4.   This statement has been sent to all shareholders and can be obtained by the 
     public from the Company's registered office, Cowick Hall, Snaith, Goole,
     East Yorkshire DN14 9AA


                      This information is provided by RNS
            The company news service from the London Stock Exchange