UPDATE 1-Weak currencies weigh on chemical maker Croda

Thu Oct 31, 2013 5:59am EDT

* Third-quarter profit up 5.4 pct to 58.6 mln stg

* Third-quarter underlying sales up marginally

* Sees fourth-quarter profit likely to be similar to third-quarter profit

* Shares fall as much as 9 pct

Oct 31 (Reuters) - British specialty chemical maker Croda ground out a 0.8 percent increase in underlying sales in the third quarter as it struggled with lacklustre demand and weak currencies.

Croda's shares were down about 8 percent at 2433 pence at 0931 GMT on the London Stock Exchange, making the stock one of the biggest percentage losers among the FTSE 100 companies.

The company, which makes chemicals used in personal care, crop care and home care products, said it expected fourth-quarter profit to be similar to that of the third quarter.

Croda said that a significant devaluation of the Japanese yen and the Indian rupee had reduced the benefit of currency translation compared to the first half. Asia-Pacific accounts for about a quarter of the company's sales.

Steep falls in emerging market currencies are hurting the company, even as sales in Europe begin to recover slowly. Croda counts Unilever, L'Oreal and Procter & Gamble among its customers.

Pre-tax profit increased 5.4 percent to 58.6 million pounds ($94.20 million) during the period.

The company said sales at its consumer care business increased 3.2 percent to 145.4 million pounds.

Consumer care, which consists of the personal care, health care and crop care businesses, accounts for over half of Croda's revenue.

"Despite stable margins and year-on-year growth in 'Consumer Care', with negative currencies likely to impact Q4 and market conditions 'subdued' the earnings outlook remains uncertain," said JP Morgan Cazenove analyst Martin Evans.