Croda Full-Year Report 2023

2023 performance impacted by prolonged destocking and a weak macroeconomic environment

Sales down 11% on a pro forma basis as customers reduced inventory levels across multiple markets

• Consumer Care sales down 1% with underlying sales down 11% in Beauty Care, 1% lower in Beauty Actives and Home Care, and up 18% in lower-margin F&F business
• Life Sciences sales 5% lower, excluding Covid-19 lipid sales, with sales up 3% in Pharma on that basis, up 9% in Seed Enhancement and down 19% in Crop Protection due to continued destocking
• Pro forma sales down 35% in Industrial Specialities reflecting destocking and reduced demand

Adjusted profit before tax down 33% to £308.8m (2022 pf: £463m) in line with updated expectations

• 18.9% adjusted operating margin (2022 pf: 25%) due to the negative operating gearing impact from lower sales volumes, lower Covid-19 lipid sales and the negative mix impact of strong F&F sales
• Implemented immediate actions to protect profits; employee costs broadly flat, freight and energy lower

£236.3m IFRS profit before tax (2022: £780.0m); prior period benefitting from £356.0m divestment profit

Strong balance sheet underpins ongoing investment and shareholder returns

• £162.9m improvement in working capital; free cash flow up 5% to £165.5m (2022 restated: £157.4m)
• £537.6m net debt (2022: £295.2m) post Solus Biotech acquisition; leverage at 1.3x
• 1p increase in full year dividend with 32 years of unbroken dividend progression