CRODA INTERNATIONAL PLC

Recommendation history

• Q1 2026HoldHold: Croda delivered Q1 sales of £446m, up 1% at constant currency and in line with expectations, with Consumer Care +4%, Life Sciences -3% and Industrial -2%; full-year 2026 guidance is unchanged. The recovery case rests on easier comparisons, pharma improvement, F&F growth and transformation benefits, but the stock is not a clean buy while pricing magnitude remains undisclosed, Q1 price/mix is fading, and annualised sales appear roughly 7% below consensus.
• FY 2025HoldHold. Croda delivered 2025 sales growth of 7% in constant currency, adjusted operating profit growth of 8% to £295m and free cash flow of £162m, while targeting 3-6% organic growth and an adjusted operating margin above 20% by 2028. The recovery thesis is credible through £100m of annualised transformation savings and stronger Consumer Care/Life Sciences demand, but analysts correctly highlighted that 20% margins are not a “walk in the park,” the growth track record is inconsistent, and recent impairments show execution and capital-allocation risk.
• H1 2025HoldHold: Croda delivered a solid H1, with constant-currency sales up 7% to £856m and adjusted operating profit up 12% to £147m, while FY25 adjusted PBT guidance remains £265m–£295m. The £100m annualised savings plan by 2027 and volume recovery are credible positives, but price/mix was down 4%, free cash flow was only £34m, inventory is structurally too high, and management gave little quantified evidence that the margin recovery will translate into returns.
• Q1 2025HoldHold: Croda delivered a strong Q1, with sales up 8% reported and 9% at constant currency, Life Sciences up 10% reported and crop protection growing at a high-teens rate. Volume growth, improving utilisation and £25 million of planned annual cost savings support earnings, but only four weeks of order-book visibility, a potentially softer Q2, tariff uncertainty and still-weak consumer health/veterinary markets make this an encouraging recovery—not yet a clean buy.
• FY 2024HoldCroda delivered FY24 adjusted PBT of £273m at constant currency (£260m reported) on £1.6bn sales, with volumes up 7% but operating margin falling to 17.2%. FY25 adjusted PBT guidance is £265m–£295m, supported by £25m of planned efficiencies and recovering Consumer Care/Life Sciences, but the outlook still depends on an unproven Crop recovery, higher asset utilisation and commercialisation of Pharma investments; hold rather than buy.
• H1 2024HoldHold: Croda delivered £816m of H1 sales, down 7%, with adjusted operating profit down 23% to £136m, while free cash flow rose 69% to £123m. Management expects FY2024 operating margin of about 17% and adjusted PBT of £260m-£280m, but the recovery still depends on a modest Crop Protection improvement, stronger Pharma and Seed Enhancement, and utilization rising from 65% toward the historical ~80% level.
• Q1 2024HoldCroda’s Q1 showed an encouraging but still fragile recovery: group sales rose 8% sequentially excluding prior-quarter COVID lipids, Consumer Care volumes grew double digits, order-book volumes were 15–20% above last year, and plant utilisation improved from 55% to 65%. However, Crop Protection remained flat at a weak level, Pharma declined slightly, pricing fell low-to-mid single digits sequentially, and meeting FY24 guidance still depends heavily on an uncertain second-half Life Sciences recovery. The improved demand signals are not yet strong enough to justify buying ahead of clearer evidence.