* First-half adjusted pretax profit falls 6 pct to 125.3 mln
* Sales fall 4.5 pct to 537.4 mln stg
* Shares down 1 pct
(Adds finance director comments, updates share movement)
By Karen Rebelo
July 22 Specialty chemicals maker Croda
International Plc, feeling the effects of a strong
British pound, warned on Tuesday that this year's pretax profit
would be lower than last year's.
However, the company, which makes chemicals used in
cosmetics, pesticides and detergents, said it expected to
achieve "progress" in its underlying profit.
Croda, whose customers include Unilever Plc,
L'Oreal SA and Procter & Gamble Co, generates
only about 5 percent of revenue in the UK but reports in pounds.
"At the moment we've got a perfect storm," Finance Director
Sean Christie told Reuters. "Sterling is about the strongest
currency in the world and we make a lot in Europe as well, and
(the euro) is the second-strongest currency in the world."
The pound has risen about 11 percent against the
dollar and 8 percent against the euro over the past
Croda's adjusted pretax profit fell 6 percent to 125.3
million pounds ($214 million) in the first half ended June 30
from 133.2 million pounds a year earlier.
Sales fell 4.5 percent to 537.4 million pounds as revenue
fell in all three of its divisions - consumer care, performance
technologies and industrial chemicals.
Currency translation reduced sales by 38.3 million pounds,
the company said.
Analysts on average had expected a pretax profit of 125.2
million pounds on revenue of 540.8 million pounds, according to
Thomson Reuters I/B/E/S.
The company, whose chemicals are used in anti-ageing and
anti-wrinkle creams, said sales of its core consumer care
business, which generates over half of overall revenue, were
also hurt by weak demand for mass market cosmetics in Europe.
Croda, which raised its interim dividend to 29.5 pence per
share from 29 a year earlier, reported a pretax profit of 250.1
million pounds in 2013.
"We believe Croda now needs some currency relief and a
return to underlying growth in consumer care," JPMorgan Cazenove
analyst Martin Evans wrote in a note.
Croda's shares were down 1 percent at 2193 pence at 0850 GMT
on the London Stock Exchange. Up to Monday's close, the stock
had fallen about 10 percent this year.
($1 = 0.5855 British pounds)
(Reporting by Karen Rebelo; Editing by Ted Kerr)