Updates & Ideas

Elementis - Disposals boost specialty chemicals firm’s margins

March 2024

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Sometimes the best gains can be made when companies are near the end of a major restructuring and feel confident enough to put out formal growth targets. In the case of speciality chemicals business Elementis, the company has endured a challenging few years, partly due to macro headwinds such as the Pandemic and Ukraine war but also because it’s been weighed down by duds within its portfolio. However, last year it sold off its highly cyclical and low margin chromium business, for around US$107m. This not only more than halved leverage from over 3x net debt / EBITDA to just 1.5x, but also left it with two divisions with decent growth prospects and superior profit margins. Elementis is now enjoying the benefits with its year-end update sta ...

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Elementis (October 2024)

Elementis - Sale of Chromium side will enhance margins (January 2023)

Elementis - Results near top end of expectations (September 2022)

Elementis (June 2022)

Elementis - Specialty chemicals group an intriguing “opening up” play (April 2022)

Elementis (May 2019)

Elementis (November 2018)

Elementis - Personal care acquisition transforms growth prospects (May 2018)

Elementis - Personal care acquisition transforms prospects (April 2018)

Elementis (August 2015)

Elementis (April 2015)

Elementis - Net cash to reach US$110m in 2016 (September 2014)

Elementis (April 2014)

Elementis (December 2013)

Elementis (October 2013)

Elementis - Specialty chemicals firm enjoys high margins and returns on capital (May 2013)

Elementis - Expands capacity in buoyant US (November 2012)

Elementis - New special dividend (September 2012)

Elementis - Eyes return of cash to shareholders (June 2012)

Elementis - Fast-growing additives group throwing off copious amounts of cash (May 2012)

Elementis (December 2011)

Elementis - Hefty broker upgrade makes shares very cheap (September 2011)

Elementis - Euro 23m fine is repealed (August 2011)

Elementis - 13% profit upgrade (June 2011)

Elementis - Huge Asian opportunity for specialty chemicals group (April 2011)

Elementis - A jewel in the specialist chemicals sector (February 2011)

With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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