# Croda International Plc Innovation driving continued sales momentum in Personal Care and Life Sciences

- Link: https://www.directorstalkinterviews.com/croda-international-plc-innovation-driving-continued-sales-momentum-in-personal-care-and-life-sciences/412760706
- Published: 2018-11-01T07:48:59+00:00
- Author: Charlotte Edwards

**[Croda International Plc](https://www.directorstalkinterviews.com/ftse-company/croda-international/crdo.l)**(
LON:CRDA), the speciality chemical company that creates high performance ingredients
and technologies relied upon by industries and consumers globally, today updated
on its trading during the third quarter 2018, ended 30 September 2018.

**Growing the Core – Core Business constant currency sales up 4.5%**

The sales momentum seen in the first half of the year continued in Q3, with further
growth across all regions and increased innovation. Constant currency sales grew
by 3.4%, with the Core Business up 4.5%, driven by a strong performance in the Group’s
consumer businesses. Core Business year to date growth was 4.7%. Sales of New and
Protected Products (NPP) reached 28.4% of total sales, with double digit percentage
growth in Personal Care and a robust pipeline of new opportunities and technologies
across all sectors.

In reported currency, Q3 sales for the Group were 2.9% higher and up 0.5% year to
date, with currency translation headwinds moderating. Year to date profit margin
continued slightly above prior year, reflecting improved product mix and pricing,
growing value ahead of volume.

**Personal Care sales growth driven by innovation**

Constant currency sales in Personal Care were up 4.9% in Q3 and 7.8% year to date,
reflecting both price/mix and volume improvements. Demand was robust in all three
business units, led by the innovation-rich Beauty Actives business. Sales to multinational
customers continued to improve, with Croda ingredients selected for several major
product launches, supporting ongoing growth with regional and local customers. All
regions saw progress, led by healthy demand in Asia and North America, and a steady
recovery in Latin America. NPP sales reached a record proportion of sector sales.

**Excellent sales growth in Life Sciences**

In Life Sciences constant currency sales were up 8.5% (9.3% excluding the impact
of the North American API contract which we exited at the end of 2017). Year to 
date constant currency sales were 4.2% higher (8.0% excluding the exited API contract).
The Q3 performance reflected strong sales in Health Care, driven by increased global
demand for high purity excipients for complex drug delivery systems and expansion
into regional drug markets, such as India. Following good growth in the first half
of the year, sales in Crop Protection moderated in Q3 but nevertheless saw progress
with smaller customers. Our Seed Enhancement business, Incotec, continued to grow
following recent investment to improve innovation facilities in Europe and China.
The integration of our latest crop technology acquisition, Plant Impact, is progressing
well, with sales development actively supported by Croda’s global sales team.

**Continued progress in transition to higher value in Performance Technologies**

In Performance Technologies constant currency sales grew by 1.8% in Q3 and by 1.7%
year to date. Price/mix continued to improve in Q3, with volume declining as low
margin business was shed, although at a lower rate than the first half of the year
as the programme passed its anniversary. This improvement in value over volume is
being progressively supported by an increase in NPP sales. Energy Technologies saw
further demand for biodegradable lubricant additives, as customers look to improve
the [sustainability](https://www.directorstalkinterviews.com/sustainability-green-stocks-news)
of their products by using Croda ingredients. In Smart Materials, we continue to
identify new opportunities for IonPhasE, our recent acquisition in static dissipative
polymers.

**Stretching the Growth – connecting to faster growth markets**

We are accelerating sales in our core markets; creating more technology, NPP and
intellectual property; and delivering disciplined capital allocation. During Q3 
we successfully commissioned our biosurfactants plant in North America and launched
our ‘Eco’ range of biobased surfactants, designed to meet increasing market demand
for sustainable, high performance ingredients. In Personal Care, we globally launched
our MoonshineTM range of innovative special effect pigments for the fast growing
premium colour cosmetics market. In Life Sciences, we invested in Sisaf, a pioneering
UK-based bio-pharmaceutical company, to develop a new range of novel drug delivery
solutions.

**Outlook affirmed**

> **Commenting on the trading update, Steve Foots, Chief Executive Officer of Croda,
> said:**
> “This has been another strong, consistent quarter of growth for Croda. It is encouraging
> to see ongoing momentum in our consumer businesses, underpinned by innovation 
> and our unique customer intimacy, supported by our ‘value over volume’ progress
> in Performance Technologies. We are delivering our strategy of ‘Growing the Core’,
> driving top line growth at industry leading margins to achieve superior returns,
> and ‘Stretching the Growth’, accelerating delivery across our markets. We are 
> on track to deliver our expectations for the year.”

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