Elementis trading in line amid subdued market

The FTSE 250 firm said revenue for the first half of 2023 was down 6% year-on-year at $364m.

However, on an underlying basis, the revenue decrease was more limited art 4%.

The board put the drop in revenue down to lower volumes; however, it was partially offset by improved pricing and a favourable product mix.

Despite the revenue decline, Elementis (LON:ELM) said its adjusted operating profit reached $53m, up from $42m in the second half of 2022.

However, when compared to the prior year period, the adjusted operating profit was down by 10%, or 7% on an underlying basis, from $58m.

The company’s adjusted operating margin for the first half came in at 14.4%, a marginal decrease from the 15.0% recorded in the prior year period.

Profit from continuing operations amounted to $26m, up from $18million.

One significant highlight of the interim results was the notable reduction in net debt.

As at 30 June, Elementis said its net debt stood at $255m, down from $367m at the end of 2022.

The improvement was mainly driven by the successful disposal of Chromium, which brought in proceeds of $139m.

“The group has performed well in a weak demand environment, reflecting the strength of its business model and the benefits of proactive self-help actions,” said chief executive officer Paul Waterman.

“Personal care had a strong first half, gaining from innovative new product launches and new business success.

“Performance specialties demonstrated its resilience as our new streamlined operating structure enabled a material talc performance recovery and improved focus on higher value-added products in attractive growth markets.

“Whilst we are mindful of continued macro-economic risks, the group is well positioned to manage these impacts and deliver against full year expectations.”

At 1003 BST, shares in Elementis were up 7,18% at 116.4p.