6th Aug 2020 10:20
(Alliance News) - Chemicals business Synthomer PLC on Thursday reinstated its annual guidance and said that it expects to pay a 2020 final dividend following a "resilient" first half performance.
The company added that there was no material disruption to operations through Covid-19 pandemic as the chemical sector was largely designated as essential industry.
Chair Neil Johnson said: "Geographic and end market diversity and product differentiation have underpinned Synthomer's resilient performance with our half year earnings before interest, tax, depreciation and amortisation in line with last year.
"We are encouraged by much improved trading in June and July and accordingly we have reinstated guidance and, subject to continued progress, expect to pay a 2020 final dividend."
The FTSE 250-listed company anticipates 2020 Ebitda to be broadly in-line with current market consensus of GBP211.3 million.
For the six months to June 30, Synthomer swung to a pretax loss of GBP4.7 million from GBP56.6 million profit in the year ago period. The loss was attributed to a large GBP63.1 million exceptional charge in the period versus GBP13.6 million charge a year ago.
Underlying Ebitda inched higher, however, to GBP100.2 million from GBP99.7 million.
"Whilst Q2 2020 was impacted by Covid-19, the H1 2020 Underlying Ebitda reflected a robust performance of the heritage Synthomer business of GBP92.3 million, just 7% down on the comparative period, and the Ebitda contribution from Omnova of GBP7.9 million," the company explained.
Synthomer completed the GBP654 million acquisition of Omnova, a US-based speciality chemical company, in April.
First half revenue fell to GBP733.7 million from GBP762.7 million. The decline reflected the very significant fall in raw material prices in the second-quarter as a result Covid-19, more than offsetting the overall increase in volumes of 2%.
Shares in Synthomer were up 5.4% at 311.40 pence each in London on Thursday morning.
By Tapan Panchal; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Synthomer