Haimnes Reports Over 6% Annual Profit Growth After Selling Talc Powder Business

Elementis recently released its full-year 2025 financial results. This is the company's first annual report following the sale of its talc business and its transformation into a pure-play specialty chemicals company. The report shows that despite a weak coatings market environment, the company achieved strong, resilient profit growth through strategic focus and cost optimization.

CEO of Elementis, Luc van Ravenstein, commented on the 2025 performance: "I am pleased to report that Elementis performed solidly throughout 2025, with strong profit growth, expanded margins, and further progress toward our goals. We transformed into a pure-play high-end specialty chemicals business through the sale of the talc business, the acquisition of Alchemy, and the launch of the Elevate Elementis strategy. These are not just milestones - they have laid the foundation for the company as a team to focus and move forward."

Profit growth exceeds 6%

In 2025, Hainan S achieved sales of $597.5 million, a slight decrease of 1.0% year-over-year, primarily due to weak demand for paint products in all regions. However, driven by proactive pricing measures and cost management, adjusted operating profit reached $126.7 million, an increase of 6.3% year-over-year; the adjusted operating margin improved by 150 basis points to 21.2%.

Due to a $110.5 million book loss from the sale of its talc business in the first half of the year, the company reported a statutory net loss of $45.5 million. Excluding adjustments, adjusted net profit from continuing operations was $81.5 million, an increase of 13.2% year-over-year.

In terms of cash flow, the company's free cash flow was $41 million. The company successfully completed a $40 million share repurchase over the year and returned a total of approximately $79 million to shareholders. The proposed dividend for the full year is 4.3 cents per share, representing a 7.5% increase year-on-year. As of the end of 2025, the net debt was $185.4 million, with a net debt to adjusted EBITDA ratio of 1.3x, maintaining a healthy level.

Personal care has become a profit pillar, while coatings demonstrate resilience.

The Personal Care segment delivered particularly strong performance, with revenue increasing by 3.3% year-over-year to $224.5 million and adjusted operating profit surging by 18.2% to $72.8 million. The segment’s margin improved by 410 basis points to 32.4%, contributing 50.8% of the group’s adjusted operating profit. Growth was primarily driven by rising demand for natural and sustainable ingredients in cosmetics and skincare. Of the seven new products launched during the year, four were based on the company’s proprietary hydrous mica technology. The acquisition of Alchemy further strengthened its position in the natural cosmetics market.

Coatings segment revenue declined by 3.5% to $373 million, and adjusted operating profit fell by 10.2% to $70.4 million; the margin edged down slightly from 20.3% to 18.9%, demonstrating the business’s resilience amid a weak environment. Although demand for industrial and architectural coatings remained sluggish, the company’s energy business performed strongly, with volume, pricing, and product mix all outperforming last year. During the year, 12 new products were launched, including thickeners with high bio-based content and water-based rheology modifiers suitable for high-temperature, high-pressure drilling.

Three key transactions complete business focus

2025 is a crucial year for Haiming's strategic transformation, with three significant deals reshaping the company's business landscape.

In May, the company completed the sale of its talc business, successfully transforming into a pure-play specialty chemicals company and achieving its 2026 financial targets one year ahead of schedule.

In July, the company officially launched the "Elevate Elements" growth strategy, setting medium-term goals: to achieve mid-single-digit revenue growth over the period, an adjusted operating profit margin of more than 23%, a three-year operating cash conversion rate of over 90%, and a return on capital employed (excluding goodwill) of more than 30%.

In November, the company acquired UK-based Alchemy, a specialist in natural rheology modifiers, for $22 million, strengthening its product portfolio and technology in the cosmetics and personal care sectors.

On March 3, 2026 (following its earnings release), Hemas announced that it has entered into an agreement to sell its pharmaceutical manufacturing business to UK-based Associated British Foods plc for an enterprise value of approximately $40 million, with completion expected in the second quarter of 2026. This transaction aligns with the company’s strategy of focusing on its core markets, is expected to further enhance its operating margin, and the net proceeds are planned to be returned to shareholders.

Start 2026 with caution and advance steadily.

Facing weak demand in the coatings market and geopolitical uncertainties, Hexion remains cautiously optimistic about 2026. The company stated it has had a "solid start" to the new fiscal year.

The strategic focus for 2026 will revolve around five areas: accelerating sustainable product innovation to solidify technological leadership, deepening customer relationships and expanding direct sales coverage, enhancing operational efficiency to boost corporate agility, advancing the sustainability agenda to reduce environmental footprint, and effectively balancing capital allocation to maximize shareholder returns. The company will maintain its mid-term financial targets, with the adjusted effective tax rate expected to remain around 25%.