Elementis plc, a global specialty chemicals company, today issues a
trading update ahead of its interim results for the half year ending
June 30, 2009, which will be announced on August 3, 2009.
Trading patterns for the second quarter of the year appear to have
stabilized, following the significant drop in sales volume at the end
of last year.
In Specialty Products, sales volumes for the second quarter have
shown modest improvement over the first quarter, when sales volumes
were down by 33 per cent compared to the previous year. Customers
however remain cautious and are maintaining conservative levels of
inventory. Contribution margins and market share have remained
relatively stable throughout the first half of the year. In Asia, the
integration of Deuchem continues to progress well and the business
has benefited from robust demand in the Chinese domestic market.
In Chromium, trading in the second quarter has been similar to the
first, with sales volumes down by over 50 per cent compared to the
previous year. The closure of the Eaglescliffe, UK facility is
progressing as anticipated. The site has operated at a relatively
high production rate during the first half of the year in order to
transition the customer base and efficiently process the remaining
raw material ahead of the closure. This, together with some strategic
purchases of chrome ore in the remaining business, will lead to a net
investment in working capital during the first half, a position which
will reverse later in the year.
Consequently, it is anticipated that Specialty Products, Chromium and
the Group will have a positive operating profit for the first six
months of 2009, before previously announced one time closure and
over-hedging costs. The Group is operating well within its banking
Elementis 020 7408 9300
David Dutro, Group Chief Executive
Brian Taylorson, Finance Director
Financial Dynamics 020 7831 3113
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