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Croda inks in 80% profit rise but shares slip back

Robert Cole
Tuesday 29 March 1994 17:02 EST
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CRODA, the chemicals concern that makes most of its compounds from animal and vegetable oils rather than petroleum fuels, has increased pre-tax profits by 81 per cent, writes Robert Cole.

Taxable profits were pounds 36.7m for the year to 31 December, up from pounds 20.2m. However, the figures were flattered by pounds 10m from a disposal and pounds 2m from favourable exchange rates.

Underlying profits rose by 22 per cent, and much of this growth came as Croda's investment programme began to bear fruit. The company has spent pounds 100m over the past four years upgrading its equipment.

In 1993, Croda spent pounds 26m, twice the company's depreciation charge. Similar investment is planned for this year.

In January, Croda sold its inks business to the Wolverhampton inks specialist Manders. Money received from the sale helped finance the expenditure, which was otherwise funded from profits generated by the business.

Earnings per share rose to 27.6p against 15.3p. However, earnings were 20.1p without the exceptional profit from the sale of the ink business.

The dividend rose by 9 per cent to 5.45p. The shares fell from 376p to 352p on market fears that the sale of the ink business could hit future profits.

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