The industry has to do more to lower the use of plastic in products, argued the boss of a FTSE 250 chemicals firm.
Paul Waterman, chief executive of Elementis, told City A.M. it was “really difficult to understate how pervasive plastics are in the industry,” which was an increasingly aggravating factor in the push towards greener products and net zero carbon emissions.
He was optimistic the “world would innovate” to take on the challenge of plastic being used in products that source chemicals from companies such as Elementis – but recognised it was a pressing issue.
Elementis makes mixes for personal care items and coatings for consumer products – all of which are typically packaged in plastic downstream of chemical manufacturing.
The company has multiple environmental targets for the current decade including reducing waste 10 per cent, water usage in current operations 10 per cent, increasing energy efficiency 20 per cent and cutting greenhouse gas emissions 25 per cent.
However, despite the clampdown on plastic straws and single-use bottles in the West – 380m metric tons of plastic are still being produced every year worldwide.
Approximately 91 per cent of plastic is still not recyclable, with roughly half of the global annual plastic production destined for a single-use products.
Waterman’s comments follow the London-listed company’s full year results, with company posting widening losses of £46m, multiplying from £6.3m in 2021.
Elementis has swallowed an £86.7m non-cash goodwill impairment charge in its talc business – with the war in Ukraine depressing demand in key markets, alongside energy price increases.
It has also been hit with inflationary pressures, higher energy bills and labour costs – which have eaten into potential earnings.
Nevertheless, revenues increased 3.8 per cent to £619.1m, and adjusted operating margin for 2022 improved to 13.6 per cent from 12.4 per cent in the prior year.
It also sold its chromium business for £143m in January, which will give it a cash boost in its results next year.
Despite the headline losses, investment analysts at Numis kept their buy stance with a target price of 150p per share.
Meanwhile, shares in the company were essentially stable – trading 0.08 per cent down in today’s session at 126.3p per share on the FTSE 250.