Chemical substances enterprise Synthomer lifted its full-year earnings steering on Wednesday and reinstated its dividend amid “sturdy” buying and selling momentum in all three of its divisions.
On the time of its interim leads to August, the corporate mentioned it anticipated FY 2020 earnings earlier than curiosity, tax, depreciation and amortisation to be broadly-in-line with market consensus of £211m. Nonetheless, it now expects FY EBITDA of round £232m, up 10% on its August steering.
As well as, Synthomer mentioned it has determined to reinstate the interim dividend that was suspended in April “because of the group’s sturdy buying and selling efficiency and money technology”. It declared an interim dividend of 3p per share, payable on 10 November. The corporate has additionally totally reinstated its current dividend coverage and mentioned it intends to pay a ultimate dividend in keeping with its capital coverage.
Synthomer mentioned volumes and margins within the Efficiency Elastomers division have been forward of the prior yr as a result of sturdy demand in nitrile latex following the Covid-19 pandemic and improved situations in SBR latex via the third quarter.
In the meantime, the Purposeful Options section continued to learn from the mixing of Omnova – the acquisition of which was accomplished in April – and can also be buying and selling forward of final yr, albeit some market sectors are demonstrating stronger resilience than others.
The Industrial Specialities arm continued to enhance within the third quarter following a weaker second quarter, which was impacted by the pandemic. Present run fee volumes and margins are on or above the prior yr, Synthomer mentioned.
Chief government Calum MacLean mentioned: “It is a very encouraging efficiency with all enterprise divisions performing forward of prior yr. Alongside this sturdy momentum, we now have made vital strategic progress, with a choice to shut our website in Oulu and the mixing of Omnova persevering with forward of our preliminary expectations.
“This underpins our confidence for the rest of this yr and past resulting in an improve to our steering for the total yr and reinstating our interim dividend.”