Synthomer (LON:SYNT) Releases Quarterly Earnings Results

Key Points

• Synthomer exceeded first-half expectations: Continuing-business revenue rose 5.1% in constant currency, EBITDA increased 13%, EBIT climbed nearly 42%, and EBITDA margin expanded to 10.1%.
• The company raised its 2026 outlook to slightly above market expectations, supported by specialty-product growth, cost savings, stronger free cash flow, and lower expected covenant leverage.
• Operational risks remain: Adhesive Solutions incurred about €10 million in lost gross margin from facility reliability issues, while higher finance costs and the nonrecurrence of a second-quarter market-disruption benefit could weigh on second-half performance.

Synthomer (LON:SYNT - Get Free Report) issued its quarterly earnings results on Tuesday. The company reported GBX (4.30) earnings per share (EPS) for the quarter, Digital Look Earnings reports. Synthomer had a negative return on equity of 16.66% and a negative net margin of 9.03%.

Here are the key takeaways from Synthomer's conference call:

• First-half results exceeded expectations: continuing-business revenue rose 5.1% in constant currency, EBITDA increased 13%, EBIT grew nearly 42%, and EBITDA margin expanded 80 basis points to 10.1%.
• The company raised its full-year 2026 outlook to slightly above market expectations, citing recurring specialty-product growth, cost savings, improved free cash flow, and year-end covenant leverage expected at 4.0x–4.35x versus 4.9x at June.
• Synthomer reported progress toward a more specialty-focused portfolio, including strong demand for data-center intumescent coatings, oil-and-gas drilling additives, medical adhesives, and sustainable products; three additional divestment processes could generate approximately £150 million–£200 million of proceeds.
• All three divisions delivered volume and revenue growth, while CCS EBITDA rose 33% and Adhesive Solutions continued its transformation program; however, the company expects the roughly £6 million benefit from second-quarter market disruption, particularly in NBR, not to recur in the second half.
• Adhesive Solutions lost approximately €10 million of gross margin from intermittent reliability issues at facilities in the Netherlands and Texas, although management expects both problems to be resolved during the third quarter; finance costs are also rising, with full-year income-statement interest expected at £73 million–£75 million.

Synthomer Price Performance

SYNT opened at GBX 90.49 on Tuesday. Synthomer has a 52 week low of GBX 16.70 and a 52 week high of GBX 123.95. The company has a debt-to-equity ratio of 90.86, a quick ratio of 0.97 and a current ratio of 1.57. The firm has a market capitalization of £148.35 million, a PE ratio of -0.94, a P/E/G ratio of -0.17 and a beta of 1.03. The company has a fifty day moving average price of GBX 93.98 and a two-hundred day moving average price of GBX 64.79.

Analyst Upgrades and Downgrades

A number of brokerages recently issued reports on SYNT. Berenberg Bank boosted their target price on shares of Synthomer from GBX 60 to GBX 100 and gave the stock a "hold" rating in a research report on Wednesday, May 6th. Jefferies Financial Group reiterated a "hold" rating and issued a GBX 65 price target on shares of Synthomer in a research report on Thursday, April 30th. Finally, Peel Hunt reaffirmed a "buy" rating and set a GBX 200 price objective on shares of Synthomer in a report on Tuesday. One analyst has rated the stock with a Buy rating and four have issued a Hold rating to the company. According to data from MarketBeat.com, Synthomer has an average rating of "Hold" and a consensus target price of GBX 109.40.

About Synthomer

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 on the LSE 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.

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