Synthomer PLC Q3 Trading update (5872V)
November 06 2017 - 1:00AM
UK Regulatory
TIDMSYNT
RNS Number : 5872V
Synthomer PLC
06 November 2017
November 6(th) 2017
Q3 Trading update
Continued progress in line with expectations; Full Year 2017
outlook unchanged
Synthomer plc ('Synthomer' or 'the Group') today issues a
trading update for the third quarter ('Q3') ended September 30(th)
2017.
Trading
Europe and North America
Europe and North America continued to trade well and in line
with our expectations. Q3 reported volumes and unit margins were in
line with the same period last year. On a segmental basis, we saw
some weakness in Dispersions for Construction and Coatings
applications but this was offset by a robust performance in Latex
for the Paper and Foam markets.
Our investment programme in Germany to expand our Dispersions
capacity remains on schedule for commercial production in Q3
2018.
During the quarter, we announced the acquisition of BASF's
Austrian Latex business and assets for an enterprise value of
EUR30million. The acquisition is expected to complete early in 2018
following receipt of regulatory approvals and satisfaction of other
closing conditions.
Asia and Rest of World
Asia and Rest of World also continued to trade in line with our
expectations. Volumes were flat versus the same period last year
albeit the underlying market for Nitriles continued to grow at more
than 10%. As expected, following the introduction of additional
industry capacity mid 2016, unit margins were lower than Q3 2016
but have remained in line with H1 2017. Our investment plan to add
further nitrile capacity at our plant in Malaysia remains on track
and is expected to come on line in Q3 2018.
Foreign currency
The Group expects approximately GBP4m of benefit from the
translation effect relating to the weakness of sterling experienced
in the first half of the year. Assuming rates remain broadly
unchanged for the remainder of the year, our expectation is that
there will be no further benefits from currency.
Financial Position
The Group has continued to generate strong cash flows in Q3 and
the balance sheet remains strong with net debt/EBITDA ratio at
circa 1.3x at the end of the quarter.
FY 2017 Outlook Unchanged
We remain focused on driving sustainable growth whilst also
continuing to evaluate acquisition opportunities. The Board's
expectations for Full Year 2017 remain unchanged from the interim
results in August, underpinned by resilient trading in Europe and
the Asian Nitrile market continuing to evolve in line with our
expectations.
Enquiries:
Calum MacLean, Chief Executive Officer +44 1279 436 211
Stephen Bennett, Chief Financial Officer
Charles Armitstead, Teneo Blue Rubicon +44 203 603 5220
The Company will hold a conference call for investors and
analysts at 0800 GMT today.
Please dial: +44 (0) 808 2370030 entering conference ID:
57615130# to gain access to the call.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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