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Overview
Croda International Plc (CRDA) is a UK based company that is into creating, making and selling of speciality chemicals. The company was founded in the year 1925 and is headquartered in Goole, the United Kingdom. The company has over 4,000 employees working across 18 manufacturing sites and in more than 30 countries. The main markets include Europe, Africa, the Middle East, Latin America and North America. The company has four reporting segments being Life Sciences, Personal Care, Industrial Chemicals, and Performance Technologies. [optin-monster-shortcode id="wxhmli4jjedneglg1trq"]
Key Management Team
- Mr Stephen Edward Foots: Group Chief Executive
- Mr Jeremy K. Maiden: Group Finance Director & Director
Financial Results and Review - FY2018 (£, million)
(Source: Press Release, Company Website)
Financial Commentary â FY2018
- The company reported revenue of £1,386.9 million for the year ending December 2018 as compared to £1,373.1 million in 2017 for the same period. There was an increase of 1 per cent in revenue, due to the growth in Personal care business in FY2018.
- The companyâs reported operating costs had increased marginally in comparison with the last year. Operating costs had been raised from £191.4 million in FY2017 to £193.5 million in FY2018.
- The companyâs reported operating profit increased to £328.8 million in FY2018 as compared to £326 million FY2017.
- The companyâs reported profit before tax increased to £317.8 million in FY2018 as compared to £314.1 million in FY2017.
- The companyâs reported profit after tax had increased marginally to £238.3 million (2017: £236.7 million) in FY2018.
Ratios
(Source: Thomson Reuters)
Ratios Commentary
- Gross margin reported was 37.7 per cent in the financial year 2018 and remained constant against the previous year. However, the reported margin was relatively lower than the industry median.
- EBITDA margin of 28.3 per cent for the financial year 2018 stood considerably higher than the industry median of 18.4 per cent.
- Return on equity stood at 26.3 per cent which was higher than the industry median of 15.6 per cent.
- At liquidity front, Croda International Plc current ratio was higher than the industry median of 1.66, reflecting sufficient current assets to pay its short-term obligations.
- On the leverage front, the debt-equity ratio was higher as compared to the industry median, reflecting company is more leveraged as compared to its peers.
Share Performance
- On 1st March 2019, Croda International Plc shares closed at GBp 4,888, up by 1.60 per cent against its previous day closing price.
- Stockâs 52 weeks High and Low is GBp 5,330.00/GBp 4,360.00. At the closing price, the share was trading 8.29 per cent lower than its 52w High and 12.11 per cent higher than its 52w low.
- From the previous three months, Croda International Plc share price increased by 0.25 per cent, and in the last one year, the stock has delivered 6.70 per cent returns.
- Stockâs average traded volume for 5 days was 466,433.60; 30 days - 304,059.47 and 90 days - 354,047.78. The average traded volume for 5 days was up by 53.40 per cent as compared to 30 days average traded volume.
- On the valuation front, the stock was trading at a trailing twelve months PE multiple of 25.6x as compared to the industry median of 13x.
- The companyâs stock beta was 0.87, reflecting relatively low volatility as compared to the benchmark index.
- Total outstanding market capitalisation was around £6.46 billion and a dividend yield of 1.78 per cent.
Growth Prospects and Risks Assessments
- The company has a Brexit ready model. Minor changes in the model are to let the company move UK manufactured product without any risk.
- The company through re-registration of UK products sold in the EU will able to mitigate the risk related to the regulatory frameworks.
Conclusion
The company has shown strong financial performance with an increase in the revenue and underline earnings, mainly because of healthy growth of international business. The current trading level indicates the stock movement towards 52-week high and the company with its strong financial performance can offset the adverse effects caused by macroeconomic conditions. The market can keep a watch on Croda International Plc stock going ahead.
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