Croda International sales rise in first half, operating profit slides
By Josh White
Date: Tuesday 29 Jul 2025
(Sharecast News) - Croda International reported solid sales growth for the first half of 2025 on Tuesday, with an increase in revenues across all three of its business segments, although its operating profit slid.
The FTSE 100 company said its sales for the six months ended 30 June totaled £855.8m, a rise of 4.9% compared to the same period last year.
However, operating profit declined 17.5% to £94.4m, while profit before tax fell by 19.4% to £85.5m.
Despite the challenges, Croda's adjusted results showed a more robust performance, with adjusted operating profit increasing 8.3% to £146.9m and profit before tax rising 8.4% to £138m.
"Our performance in the first half was in line with our expectations at the start of the year," said Steve Foots, chief executive officer.
"Higher sales in all businesses and regions reflect improved volumes in beauty care and crop protection, as well as another period of strong growth in F&F."
Foots said the company's actions were helping it to navigate a challenging environment, simplifying and modernising the business and supporting its efforts to enhance margins.
"We have identified a further £60m of cost savings, taking the total to £100m of annualised savings by the end of 2027."
The company said it saw strong growth across all three business segments, with consumer care reporting a 7% rise in sales, driven by a 17% increase in fragrances and flavours (F&F) and a solid performance in home care.
Life sciences also delivered a 9% increase in sales, with seed and crop protection sales rising by 17% and 12%, respectively, boosted by improved demand from multinational customers.
Industrial specialties saw more modest growth, up 4%.
Croda's adjusted operating margin improved to 17.2%, up from 16.6% in the first half of 2024, supported by higher volumes and ongoing cost-saving initiatives.
However, foreign exchange pressures and price/mix challenges partially offset those gains.
The reported free cash flow of £34.2m, a 72.1% drop from the prior year, while net debt decreased by 14.2% to £580.1m.
Croda's leverage ratio remained well within its target range at 1.5x EBITDA, up slightly from 1.4x in the first six months of 2024.
The company said its operational efficiency programme had made good progress, contributing £10m in benefits in the first half.
It had raised its cost savings target by £60m, aiming for £100m in annualised savings by the end of 2027.
The firm also initiated a review of its production and distribution assets to optimise capacity.
Looking ahead, Croda maintained its full-year profit guidance, expecting adjusted profit before tax to fall between £265m and £295m at constant currency.
Despite the ongoing economic uncertainty, the company's performance in the first half is in line with its expectations, and it remains focused on delivering strong returns and enhancing its strategic position.
Croda said it would update the market on its third-quarter sales performance on 16 October.
At 0848 BST, shares in Croda International were down 0.83% at 2,875p.
Reporting by Josh White for Sharecast.com.
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