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(Alliance News) - Elementis PLC on Thursday said it had swung to profit in 2023 despite "challenging market conditions", prompting a resumption of the company's dividend policy.
Elementis is a London-based chemicals company, which manufacturers ingredients for consumer and industrial products for a variety of industries.
In 2023, Elementis delivered USD39.7 million in pretax profit, swung from a loss of USD54.8 million in 2022.
Revenue was down 3.1% to USD713.4 million from USD736.4 million.
Earnings before interest, tax, depreciation and amortisation rose 2.8% to USD145.8 million from USD141.8 million a year prior.
Growth in the company's profit came about thanks to improved pricing and a "favourable product mix", though this was offset by lower sales volumes over the year.
Chief Executive Officer Paul Waterman hailed the company's 2023 performance as "resilient" in the face of what he called "challenging market conditions".
Coatings sales, which equates to around half of the group's revenue, were hit by a combination of customer destocking and a weaker demand than in 2022, Elementis said.
The American decorative sector suffered from a weaker housing market. European revenues were also impacted by ongoing inflationary pressures on customer demand.
The company reduced its net debt 45% to USD202 million from USD367 million, thanks in part to the USD139 million proceeds received from the early 2023 sale of its Chromium business to Yildirim Group.
As a result of its successful deleveraging, Elementis announced the resumption of dividend payments, beginning with a proposed final dividend of 2.1 cents per share for 2023. The last dividend paid by Elementis was in September 2019.
Looking ahead, Elementis said it had made a "good start" to 2024, with sales ahead of early 2023, though it added that the demand environment "remains uncertain".
Elementis has identified a pipeline of new business opportunities worth USD360 million, and said that its ongoing cost efficiency programme is expected to deliver around USD12 million of savings in 2024.
Elementis is also eyeing USD90 million in revenue growth by 2026.
CEO Waterman said: "We are pleased to resume the dividend, highlighting our confidence in Elementis' future performance.
"While market conditions remain uncertain, we believe that the combination of the growth and efficiency programmes will help us make material progress in 2024 against our 2026 financial targets."
Shares in Elementis were up 2.6% at 142.60 pence per share in London on Thursday morning.
By Hugh Cameron, Alliance News reporter
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