Synthomer Plc (SYNT.L), a supplier of acrylic and vinyl emulsions polymers, reported Thursday that it slipped to a first-half loss before tax from continuing operations from last year’s profit. On a reported basis, profit before tax was weak with lower revenues. The company also maintained its outlook for fiscal 2023 as well as medium term.<\/p>\n
Separately, Synthomer announced a fully underwritten rights issue to raise gross proceeds of approximately 276 million pounds.<\/p>\n
For the first half, profit before tax on a reported basis fell to 16.7 million pounds from last year’s 115.5 million pounds.<\/p>\n
Excluding results from the discontinued Laminates, Films and Coated Fabrics business<\/span>, loss before taxation was 47.8 million pounds, compared to profit of 112.3 million a year ago.<\/p>\n Loss for the period from continuing operations was 51.2 million pounds, compared to prior year’s profit of 82 million pounds.<\/p>\n On a per share basis, loss from continuing operations was 10.9 pence, compared to profit of 17.5 pence. Reported loss per share, including discontinued operations, was 2.6 pence, compared to profit of 18.2 pence a year ago.<\/p>\n Underlying loss before tax, including discontinued operations, was 6.7 million pounds, compared to profit of 114.7 million pounds a year ago. Underlying loss per share was 1.1 pence, compared to profit of 19.0 pence a year ago.<\/p>\n On a continuing operations basis, underlying loss was 9.2 million pounds, compared to profit of 108.0 million pounds last year.<\/p>\n Revenue declined 12.5 percent to 1.08 billion pounds from last year’s 1.23 billion pounds. Revenues fell 14.7 on a constant currency basis.<\/p>\n Regarding the current trading, the company said the trading in July and August was similar to first half, with limited visibility and subdued volumes given challenging macro conditions.<\/p>\n Outlook for the remainder of 2023 is reiterated. The Board does not anticipate a material recovery in customer demand before the end of the current year.<\/p>\n Overall, the company remains confident of making sequential progress in the second half relative to the first.<\/p>\n Further ahead, Synthomer remains confident in its ability to deliver the medium-term targets, which were mid-single-digit growth in constant currency over the cycle, EBITDA margins above 15 percent and mid-teens return on invested capital.<\/p>\n Regarding its fully underwritten rights issue, the company said the move would support reduction in leverage towards medium term target and allow greater focus on delivering speciality solutions strategy.<\/p>\n The company has also signed an RCF amendment inter-conditional with the rights issue, which adjusts its amount to $400 million and its maturity to July 2027. <\/p>\n The rights issue and a related capital reorganisation is conditional on, among other things, the passing of a number of resolutions by shareholders at a general meeting, which is scheduled to take place on September 25.<\/p>\n The company’s largest shareholder, Kuala Lumpur Kepong Bhd, with 26.9 percent of the issued share capital, has committed to take up their full rights and to vote in favour of all of the resolutions at the meeting.<\/p>\n For more earnings news, earnings calendar, and earnings for stocks, visit rttnews.com. <\/p>\n