Press Information

28 July 2005

Interim results for the half year ended 30 June 2005

• Sales £223.6 million (2004: £176.8 million); $421.5 million (2004: $321.6 million)
• Operating profit before exceptional items £8.1 million (2004: £5.6 million)
• Profit before tax and exceptional items £4.5 million (2004: £3.0 million)
• Earnings per share before exceptional items 1.0 pence (2004: 0.7 pence)
• Net exceptional items £7.6 million (2004: £1.0 million)
• Operating profit £0.5 million (2004: £4.6 million), loss before tax £3.1 million (2004: profit of £2.0 million), loss per share 0.5 pence (2004: earnings of 0.6 pence)
  
  
• 26 per cent sales growth from Servo acquisition and price increases
• 45 per cent higher operating profit before exceptional items
• Chromium prices up 17 per cent on first half 2004 - further increases announced
• Coatings volume down on soft consumer demand and slowing of Chinese growth
• New TaiCang Pigments plant on stream, East St Louis operations scaling down
• Servo rationalisation and head office reorganisation – benefits in second half

Geoff Gaywood, Chief Executive of Elementis plc, said:

"All four Elementis businesses delivered good sales growth in the first half of 2005 compared to last year, despite softer demand for pigments and additives in the coatings sector. The Servo acquisition added £40.5 million in sales and £2.0 million in operating profit, while better Chromium pricing, net of strong ongoing variable cost inflation, generated a £2.4 million operating profit improvement. Higher volumes in Specialty Rubber delivered a £0.5 million operating profit uplift.

"Elementis will begin to benefit in the second half from cost reductions related to the scaling down of the East St Louis pigments plant, the Servo rationalisation and a Head Office reorganisation, all of which have been previously announced.

"However, external inflationary cost pressures of the kind that significantly impacted 2004 performance, particularly energy and raw materials, remain a concern, and a recovery of demand in the coatings sector is unlikely in the short term."

Download full results in Adobe Acrobat® PDF format [326 KB]

An interview with Geoff Gaywood in video/audio format can be viewed on www.elementis.com and www.cantos.com from 0700 hours GMT.

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