Synthomer plc
Winter trading statement

Positive cash flow and robust earnings in subdued end markets

Synthomer plc ('Synthomer' or the 'Group') today issues a scheduled update on trading for the twelve months to 31 December 2025. We expect to report 2025 revenue of c.£1.74bn (2024: £1.93bn) and EBITDA in the range of £135-138m for the continuing Group (2024: £143.1m), in line with market expectations. The continued focus on strong operational execution, together with expanded 'self-help' cost reduction programmes, have enabled us to mitigate the impact of softer end-market demand since global tariff changes were announced at the start of Q2 and deliver resilient earnings and an increased EBITDA margin.

The Group delivered positive Free Cash Flow for the year, with a cash inflow in the second half as expected. Year-end net debt is expected to be c.£575m (H1 2025: £638.3m, FY 2024: £597.0m) reflecting rigorous focus on profit and cash management, partially supported by the recently-announced £50m receivables arrangement with our largest shareholder, Kuala Lumpur Kepong Berhad Group. The Group's covenant net debt:EBITDA as at 31 December 2025 was 4.7-4.8x, well within the requirement of less than 5.25x.

Despite the lower revenue in the year, the Group achieved a further improvement in gross and EBITDA margins, principally reflecting the ongoing strategic re-allocation of capital and other resources towards the higher margin, more resilient speciality solutions in our portfolio and 'self-help' cost reductions (mainly in the Coatings & Construction Solutions (CCS) division and in SG&A functions).

Divisionally, Adhesive Solutions (AS) continued to regain share and enhance margins, supported by our product capacity investment in Texas. End-market demand across the CCS division was varied throughout the second half, with a slightly improved trend in Q4 in coatings offset by a slightly weaker period for construction and consumer sub-segments, while weak demand for energy solutions continued, reflecting low levels of oil and gas drilling activity. Health & Protection volumes for the medical glove market from both new and existing customers began to improve in Q4, although margins in this business remain substantially below pre-pandemic levels.  

Alongside robust operational execution, we remain focused on the Group's strategic transformation. Having divested William Blythe in May 2025, we continue to progress the Group's broadened divestment pipeline in order to support deleveraging and simplify the portfolio further.

As we look to 2026, we expect to make year-on year progress driven by self-help actions, even without a significant market recovery. Specifically, we anticipate that the full year contributions from our cost programmes and product investments made in AS during 2025, ongoing margin progress in our speciality businesses and Health & Protection volume improvement will be partially offset by wage inflation and normalisation of bonus accrual in the year.

Commenting, Synthomer CEO Michael Willome said:

"We are pleased with the positive cash, robust earnings and margin performance Synthomer has delivered in 2025 given the persistently adverse market backdrop for the sector. The whole organisation has rigorously prioritised what is within our control - expanding cost savings, accelerating the portfolio transformation towards speciality solutions and closely managing resources to safeguard our financial position in response to the ongoing geopolitical and tariff-related turbulence which has unbalanced demand and supply in our end markets. The protracted downturn has accentuated the importance of our strategy: to focus on improving our operating leverage in those areas of our portfolio with strong market positions in fundamentally attractive speciality end markets. As such, while the near-term environment remains challenging, we remain committed to our ambition to double Synthomer's recent earnings levels in the medium term, through self-help, end-market volume recovery and strategic delivery."

Further information:

Notes

All financial information provided in this release is as defined in the Group's 2024 Annual Report and is preliminary and unaudited. Synthomer plans to report results for the twelve months to 31 December 2025 in late March 2026.

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.3,800 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.