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Elementis plc (LON:ELM) shares slipped on Wednesday as the chemicals firm reported that the coronavirus was continuing to impact its performance despite improved trading in its third quarter.
In an update for the three months to September 30, the company said volumes in the period were down 13% year-on-year, with declines in its personal care, talc, chromium and energy divisions offsetting an in line performance from its coatings business as the segment was supported by improved industrial demand.
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Despite the overall declines, Elementis said its overall performance for the quarter was in line with its expectations, adding that it had launched three new products, delivered US$9mln of new business and remain on track for delivery of US$15mln in cost savings.
Looking ahead, the company said while market conditions remained “challenging” and future visibility was limited, it had seen “solid demand in October” and a robust order book for November. For 2021, the company highlighted an “encouraging” pipeline for new business and innovation, having made good progress underpinning US$10mln of supply chain cost efficiencies. The firm also said its new AP Actives plant in Indian remains on track for start up in mid-2021.
“Overall performance has been resilient and in line with our expectations. Nevertheless, the macroeconomic outlook remains uncertain and our focus remains on managing our operations well and executing our growth, innovation and efficiency agenda”, Elementis chief executive Paul Waterman said in a statement.
“In recent years we have focused Elementis on high quality, high margin activities in Personal Care, Coatings and Talc as these businesses have enduring positions of strength in structural growth markets. I am confident we will emerge from this crisis well positioned for improved top and bottom line performance and future value creation”, he added.
Shares in the group fell 2.7% to 76.3p in early trading.
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