Trading statement - Autumn 2025
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Synthomer plc
Autumn 2025 trading statement
Resilient performance in soft end-market environment
Synthomer plc ('Synthomer' or the 'Group') today issues a scheduled update on trading for the third quarter of 2025.
· Resilient Q3 2025 performance against a continuing soft market backdrop, led by Adhesive Solutions
· Additional self-help actions delivering an increasing benefit through the second half, mitigating subdued end-market conditions following trade tensions
· Expect Continuing EBITDA for 2025 to be similar to 2024
· Continued focus on strategic transformation and broadened divestment programme
Q3 2025 saw a continuation of soft demand across a number of end markets, which the Group was largely able to mitigate through our additional self-help initiatives. The Adhesive Solutions division continued to regain share and enhance margins, supported by our investment in increased APO capacity for adhesive applications at our Texas facility, which came onstream in July. Health & Protection volumes for the medical glove market remained subdued in the period, although our customers are increasingly confident of benefiting from their improved competitiveness in the US medical glove market following tariff changes. End markets in the Coatings & Construction Solutions division were more varied in the period - improving construction and relatively stable consumer sub-segments were offset by a slowdown in coatings demand particularly in the USA and low levels of oil and gas drilling activity affecting the energy solutions business. As anticipated, our 'in region, for region' manufacturing strategy means we are experiencing limited direct tariff impact which we are largely offsetting through surcharges, but we remain mindful that ongoing uncertainties around the global trade environment continue to create volatility in end-market demand.
As previously described, the Group has responded to the market environment by identifying additional rationalisation and cost efficiency opportunities. The new programme announced in August, which includes the removal of around 250 roles globally from the organisation, has now largely been completed and is on track to deliver c.£20-25m in savings on an annual run-rate basis by 2026. This programme supplements the previously identified benefits from robust pricing and the efficiency, reliability improvement and other 'self-help' actions implemented in 2025.
Alongside operational execution, we continue to focus on the strategic transformation of the Group and on strengthening our balance sheet. Having divested William Blythe in May, we continue to progress the Group's broadened divestment pipeline in order to accelerate the Group's deleveraging and simplify the portfolio further. Focus on cash generation is helping to ensure that the Group retains ample committed liquidity (after repayment of the stub 2025 bonds on 2 July 2025).
With our additional self-help actions largely mitigating the soft end-market demand conditions that we anticipate will persist for the remainder of 2025, we expect Continuing Group EBITDA for the year to be similar to the £143m reported in 2024, and expect a cash inflow in H2 to result in broadly neutral Free Cash Flow for the year. As we begin to look to 2026, we anticipate progress in Group earnings and cash generation as a result of full year contributions from our self-help actions and product investments.
Commenting, Synthomer CEO Michael Willome said:
"With ongoing global geopolitical and tariff-related turbulence continuing to unbalance demand and supply in our end markets, we have sharpened our focus on what we can control - expanding our cost saving programme, accelerating the transformation of our business portfolio and allocating resources even more rigorously to strengthen our financial position. We have clear commercial, operational and strategic plans in place, which are contributing to greater resilience and a stronger portfolio mix with considerable operating leverage to end-market demand recovery. As such, we remain confident in our objective to double Synthomer's recent earnings levels in the medium term, through our cost actions and strategy of focusing the business on market-leading speciality products with sustainable, differentiated benefits for global end-users."
Further information:
|
Investors: Faisal Tabbah, Vice President Investor Relations |
Tel: +44 (0) 1279 775 306 |
|
Media: Nick Hasell, FTI Consulting |
Tel: +44 (0) 203 727 1340 |
Notes
Synthomer plc is a leading supplier of high-performance, highly specialised polymers and ingredients that play vital roles in key sectors such as coatings, construction, adhesives, and health and protection - growing markets for customers who serve billions of end users worldwide. Headquartered in London, UK and listed there since 1971, we employ c.3,900 employees across our five innovation centres of excellence and 29 manufacturing sites across Europe, North America, Middle East and Asia. With more than 6,000 blue-chip customers and £2.0bn in continuing revenue in 2024, our business is built around three divisions, serving customers in attractive end markets where demand is driven by global megatrends including urbanisation, demographic change, climate change and sustainability, and shifting economic power.
In Coatings & Construction Solutions, our specialist polymers enhance the sustainability and performance of a wide range of coatings and construction products. We serve customers in applications including architectural and masonry coatings, mortar modification, waterproofing and flooring, fibre bonding, and energy solutions. In Adhesive Solutions our products help our customers bond, modify and compatibilise surfaces and components for applications including tapes and labels, packaging, hygiene, tyres and plastic modification, improving permeability, strength, elasticity, damping, dispersion and grip. In Health & Protection and Performance Materials we are a world-leading supplier of water-based polymers for medical gloves, and a major European manufacturer of high-performance binders, foams and other products serving customers in a range of end markets.
Our purpose is creating innovative and sustainable solutions for the benefit of customers and society. Around 20% of our sales volumes are from new and patent protected products. At our innovation centres of excellence in the UK, China, Germany, Malaysia and Ohio, USA we collaborate closely with our customers to develop new products and enhance existing ones tailored to their needs, with an increasing range of sustainability benefits. Our 2030 decarbonisation targets have been approved by the Science Based Targets initiative as being in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement, and since 2021 we have held the London Stock Exchange Green Economy Mark, which recognises green technology businesses making a significant contribution to a more sustainable, low-carbon economy. Find us at www.synthomer.com or search for Synthomer on LinkedIn.
Legal Entity Identifier (LEI): 213800EHT3TI1KPQQJ56. Classification as per DTR 6 Annex 1R: 3.1.
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