Snaith, East Yorkshire-based Croda, a high-tech firm “using Smart science to improve lives” has warned of a likely drop from its 2022 record profits in its latest statement to the city.
The business saw sales top £2 billion as profits hit £500 million in 2022, although the year saw the £667 million sale of much of Croda’s performance technologies and industrial chemicals business to Cargill to crate a “stronger margin, higher return, less cyclical, greater IP and lower carbon intensive business”. The company had also been a key player in the Covid vaccine rollout, with its lipid system to transfer the active drug into the body.
In a trading update on the first five months of the year, chief financial officer Louise Burdett has predicted pre-tax profits are likely to be between £370 million and £400 million for 2023.
The company reported that consumer care sales volumes are down double-digit percentage compared with the same period last year, although up on Q4 2022, which it said was “as a result of customer destocking continuing through the second quarter.”
Croda also blamed destocking for a dip in crop protection sales at its life science division, although sales started the year well. It also noted lower sales for Covid-19 applications in the Pharma business, although shipments of lipid systems to vaccine customers are expected to continue as expected in the second half of 2023.
A total of £143 million pre-tax profit was generated in the first five months of the year. Burdett added: “With customer destocking in consumer and industrial end-markets now expected to continue into the second half year and momentum moderating in Crop Protection, full year 2023 Group profit before tax is now expected to be between £370m and £400m.”
Full half-year results are due to follow in late July.