U.K specialty chemicals company Croda International PLC (CRDA.LN) Tuesday posted a 61% rise in full-year pretax profit as sales jumped, and provided an optimistic outlook for 2009 due partly to expectations of continued good demand from companies producing consumer care products.

Signaling its confidence, the company whose oils are used in cosmetics and personal care products made by companies such as Procter & Gamble Co. (PG) and Estee Lauder (EL), increased its dividend to 19.75 pence a share, up 25% from last year.

"We've had a record year despite turbulent markets, so we're confident of making further progress in the year ahead," Chief Financial Officer Sean Christie told Dow Jones Newswires. "We've had some exposure, but we're happy with the basic drivers. It's a combination of resilient markets, particularly in consumer care, and weaker (commodity) industrial markets."

Still, some analysts said they weren't convinced the company's buoyant consumer care operations wouldn't be hit by the downturn in consumer spending, and at 1049 GMT, the group's shares were down 4.9%, or 25 pence, at 499 pence, underperforming a 1.8% decline in the FTSE 250.

Analysts said profit taking also weighed on the stock as well as the results of Swiss peer Givaudan (GIVN.VX), which reported worse-than-expected results as high raw materials prices and the strength of the Swiss franc took their toll.

WH Ireland analyst Keith Ashworth-Lord, who has a buy rating on the stock, also noted that the company's debt had risen by GBP60.5 million, inflated in sterling terms by the currency's recent fall. "Debt for the full-year increased, and that might spook the markets as debt levels at the moment are such a hot topic," he said.

England-based company said pretax profit from continuing operations rose to GBP98.4 million for the whole of 2008, from GBP60.8 million in 2007, as demand in its core markets remained strong and its was able to offset cost inflation through increased prices. Sales rose 19% to GBP956 million.

Consumer care sales were up 46% to GBP113.9 million during the fourth quarter, and overall trading remained robust despite its industrial specialties operations - which make polymer, lubricant and coatings additives - booking a 15.7% fall in sales, the group said.

Cazenove analysts said the results had held up well on the back of buoyant demand and robust pricing, but warned that further falls in consumer spending could impact its markets and it could struggle to push through any more substantial price increases. The brokerage has an inline rating on the stock.

Christie said the company is betting on continued demand from the health and home sectors, which he thinks won't be affected by weakening consumer confidence or economic downturns. The company will also continue to benefit from sterling's weakness as 90% of its sales are outside the U.K., he said.

The CFO said the group currently had no disposal or acquisition plans, and would focus on organic growth.

Ashworth-Lord forecast a fall in prices of raw materials this year, which would benefit the company's margins.

"Debt is serviced by cash generated in matched currency...(so) headroom on the facilities also rises and ebitda translated into sterling rises to protect the covenants," he added.

 
   Company Web site: www.croda.com 
 
   -By Monica Mark, Dow Jones Newswires; 44 207 842 9295; monica.mark@dowjones.com

(Kim Vlach in London contributed to this article.)