Synthomer shares tumbled 10.3% in early afternoon trading on Tuesday following an underlying EBITDA fall of 46.2% to £173.1 million in HY1 2022 against £322.7 million in HY1 2021.
Synthomer said all businesses delivered EBITDA growth except for its Performance Elastomers sector, following a 2021 swell of demand for Nitrile Butadiene Rubber (NBR) linked to the Covid-19 pandemic.
The UK-based polymers supplier noted a double-digit EBITDA rise in its Functional Solutions and Industrial Specialties businesses.
The group confirmed an underlying operating profit drop of 56% to £132 million from £288.6 million, alongside an underlying pre-tax profit decline of 54.6% to £114.7 million compared to £272.4 million.
Synthomer reported an underlying revenue climb of 8.6% to £1.3 billion against £1.2 billion, and a statutory revenue growth of 8.5% to £1.3 billion compared to £1.2 million year-on-year.
“All parts of the business except NBR generated EBITDA growth against a strong H1 2021 comparator, demonstrating the strength and diversity of Synthomer’s portfolio,” said Synthomer CEO Michael Willome.
“Our performance reflects the benefits of recent acquisitions with Functional Solutions continuing to leverage its increased global reach and portfolio depth and Adhesive Technologies having a strong first quarter in our Group, in line with our expectations. We have successfully managed higher costs and have passed them through, helping to enhance our profitability.”
“Whilst NBR market conditions have yet to normalise following a period of exceptional COVID-19 related demand, we are focused on the tremendous opportunities available elsewhere in the Group. I am confident that the Group’s enhanced scale, portfolio depth and geographic diversity will continue to underpin our resilience, supporting further progress in the second half and into 2023.”
The firm mentioned an EPS slide of 61.1% to 19p from 49.3p the last year.
Synthomer recommended a dividend of 4p against 8.7p the year before.