**Summary of Synthomer PLC Interim Results for H1 2025**
Synthomer PLC, a leading supplier of specialized polymers and ingredients, reported its interim results for the six months ended June 30, 2025, highlighting continued earnings growth despite subdued market conditions. Key points from the report include
### **Financial Performance**
**Revenue**Declined by 9.8% to £925.2 million (H1 2024: £1,025.6 million), with a constant currency decline of 8.8%, primarily due to lower volumes and raw material price pass-throughs.
**EBITDA**Increased by 4.1% to £77.8 million (H1 2024: £74.7 million), with a constant currency growth of 5.4%, driven by self-help actions and cost efficiencies.
**EBITDA Margin**Improved to 8.4% from 7.3% in H1 2024, reflecting better cost management.
**Underlying Operating Profit (EBIT)**Rose slightly by 0.4% to £28.3 million (H1 2024: £28.2 million).
**Statutory Operating Loss (EBIT)**Narrowed to £1.0 million (H1 2024: £2.9 million loss).
**Net Debt**Increased to £638.3 million (H1 2024: £560.6 million) due to seasonal cash flow patterns and capital expenditure.
### **Divisional Performance**
**Coatings & Construction Solutions (CCS)**: Revenue declined by 13.5% to £372.5 million, with EBITDA down 34.9% to £34.5 million, impacted by lower oil and gas drilling activity.
**Adhesive Solutions (AS)**Revenue decreased by 3.3% to £298.4 million, but EBITDA surged by 61.6% to £35.4 million, driven by cost efficiency and reliability improvements.
**Health & Protection and Performance Materials (HPPM)**: Revenue fell by 11.2% to £254.3 million, with EBITDA up 23.0% to £16.6 million, benefiting from favorable mix and cost reductions.
### **Strategic Initiatives**
**Portfolio Transformation**Completed the divestment of William Blythe in May 2025, reducing the global manufacturing footprint to <mark style="background-color:yellow">below</mark> 30 sites (from 43 in 2022).
**Cost Reduction**Implemented a £20-25 million cost reduction program, expected to deliver £9 million in benefits in H2 2025.
**Innovation**Launched new specialty adhesive investments in the US and expanded partnerships for medical glove technology.
### **Market Conditions**
**Tariff Impact**Limited direct exposure to new tariffs, but increased customer demand volatility in Q2, improving in June.
**End-Market Demand**Subdued due to trade tensions, with volumes down 7.1% compared to H1 2024.
### **Outlook**
**2025 Expectations**Some earnings progress and broadly neutral Free Cash Flow, supported by self-help actions and strategic benefits.
**Medium-Term Goal**Aim to double recent earnings levels through self-help, volume recovery, and strategic execution.
### **CEO Commentary**
CEO Michael Willome emphasized the company’s resilience in challenging markets, highlighting the success of self-help actions and strategic portfolio adjustments. He reaffirmed confidence in achieving medium-term earnings growth despite near-term uncertainties.
### **Key Metrics**
**Free Cash Flow**Negative £30.3 million (H1 2024: Negative £31.2 million), with expectations of positive cash flow in H2.
**Net Debt to EBITDA Ratio**Increased to 4.8x (H1 2024: 4.6x), within covenant limits.
Synthomer remains focused on derisking its balance sheet, advancing its specialty strategy, and prioritizing sustainable growth opportunities.