(Alliance News) - Elementis PLC on Tuesday said its annual loss widened, while revenue was up as administrative expenses and costs of sales weighed on performance.
The London-based speciality chemicals company said 2022 pretax loss was USD54.8 million, multiplying from USD7.5 million in 2021.
This was despite revenue increasing 3.8% to USD736.4 million from USD709.4 million, as administrative expenses were up 43% to USD215.7 million from USD151.0 million, while cost of sales increased 4.1% to USD437.5 million from USD420.4 million.
"In 2022 we made significant progress towards our strategic and financial goals. The sale of our Chromium business enhances portfolio quality - reducing the volatility of our earnings, improving margins, and transforming the sustainability profile of our business," said Chief Executive Officer Paul Waterman, referring to post-year sale of Chromium for USD170 million in late January.
"Despite a volatile macroeconomic environment with significant cost inflation and supply chain challenges, Elementis delivered resilient revenue growth and higher adjusted2 operating margins. This was driven by the implementation of our innovation, growth and efficiency strategy across our portfolio of advantaged, high-value specialty products, delivering new product launches, new business wins, and our continued focus on improving operational efficiency."
Looking ahead, Elementis said it started 2023 "encouraging[ly]" and was well-positioned for financial progress.
It said it was confident in delivering a medium target of 17% operating margin, alongside aiming to reinstate payment of dividends to shareholders later in 2023. Its operating margin for 2022 was 13%, up from 12% in 2021.
"Trading conditions remain subdued in many of our markets, and we therefore anticipate that demand phasing will be stronger in the second half of the year. Energy prices are also moderating from the peaks of last year," Waterman said.
"We have a strong pipeline of sales opportunities [...] Despite the continued uncertainty in global demand, we remain confident that Elementis is well placed for future growth and margin improvement."
Shares in Elementis were down 0.2% to 126.20 pence each in London on Tuesday morning.
By Greg Rosenvinge, Alliance News reporter
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Elementis (ELM)