Elementis reported a resilient financial performance for 2025, delivering stronger profits and margins despite tough market conditions and softer demand in key sectors.
The specialty chemicals group posted adjusted operating profit of $126.7 million, up 4.6%, while operating margins climbed 150 basis points to 21.2%. Revenue held steady overall as pricing gains and stronger volumes in parts of the business offset weak global demand.
Growth was driven primarily by the company’s Personal Care division, where revenue rose 2.4% thanks to higher volumes and improved pricing. Operating margins in the segment surged to 32.4%.
Performance in the Coatings business was weaker. Revenue fell 4.3% amid soft demand across all regions, although price increases and strong activity in the energy segment helped cushion the decline. Margins in the division remained relatively robust at 18.9%.
The group proposed a final dividend of 3.0 cents per share, taking the full-year payout to 4.3 cents per share, a 7.5% increase year-on-year.
However, the company reported a statutory loss of $45.5 million, largely driven by a $110.5 million loss linked to the disposal of its talc business earlier in 2025.
Elementis also completed a £40 million ($53.8 million) share buyback during the year and ended 2025 with net debt of $185.4 million, equivalent to 1.3 times EBITDA.
The company is in the middle of a major strategic shift aimed at transforming the group into a pure-play specialty chemicals business.
The overhaul — branded Elevate Elementis — includes divestments, acquisitions, innovation investment and cost cuts.
Innovation-related revenue rose to 16.4% of total sales, up 200 basis points, while the group also acquired Alchemy Ingredients for $22 million, expanding its position in fast-growing natural skincare and cosmetics markets.
Operational improvements are also underway. Capacity upgrades at the company’s St. Louis facility in the United States have lifted utilisation by 20% since the first half of 2025.
Cost-saving efforts are progressing, with $18 million delivered in 2025 and the remaining $4 million expected in 2026, part of an additional $10 million efficiency programme announced earlier in the year.
In a further move to streamline operations, Elementis said it had agreed to sell its pharmaceutical manufacturing business, which produces antacids and excipients, to Associated British Foods.
The deal is expected to complete in the second quarter of 2026, pending regulatory approval. The company said it plans to return the net proceeds from the sale to shareholders.
Despite continued weakness in coatings markets and rising geopolitical uncertainty, the company said trading in the early months of 2026 has been encouraging.
CEO Luc van Ravenstein said the group had delivered solid results despite the challenging backdrop.
"I am pleased we have delivered a resilient performance with strong growth in profitability and margins despite the challenging market environment."
He said the first phase of the company’s new strategy was already producing results.
"We have made good progress in the first six months of our Elevate Elementis strategy, leveraging our winning differentiators, acquiring Alchemy, a complementary fast-growing personal care specialist, and investing in innovation to accelerate growth. Our proven track record of delivering cost savings is creating a simpler, leaner Elementis while we continue to strengthen our direct customer relationships."
Van Ravenstein added that the pharmaceutical business sale marked another strategic milestone.
"We are pleased to have reached another important milestone for Elementis with the agreement to sell our pharmaceutical manufacturing business. The transaction sharpens our focus on our core markets, will reduce the Group's capital intensity and will enhance our operating margins. Following closing, we expect to return the net cash proceeds to shareholders."
Looking ahead, he said the group was well positioned for further growth.
"As a focused premium specialty chemicals business with a clear strategy and good operational momentum, we are well positioned to capitalise on the opportunities in large, attractive Personal Care, Coatings and new adjacent markets to create long-term value for our shareholders."
