Synthomer plc

Continuing business revenue increased 6.7% on a reported basis to GBP 954 million, or 5.1% in constant currency. EBITDA for the continuing business increased by GBP 14 million versus the prior period; management estimated roughly GBP 8 million of that was recurring and about GBP 6 million was tied to Q2 market disruption that is not expected to continue. EBIT increased by almost 42%, and EBITDA margin improved by 80 basis points to 10.1%; gross margin expanded by nearly 200 basis points. Group PBT rose by GBP 11.4 million to GBP 12.7 million. Net debt was GBP 671 million at June 30 and covenant leverage was 4.9x. Special items were GBP 36.4 million in H1, and full-year special items are expected to be GBP 60 million to GBP 65 million, about two-thirds amortization of acquired intangibles. CapEx was GBP 33.5 million in H1, with full-year CapEx expected to be around GBP 70 million. Finance costs were GBP 35.4 million in H1, and full-year interest costs are expected to be around GBP 73 million to GBP 75 million in the income statement, or around GBP 65 million in cash terms. Management now expects full-year 2026 performance ahead of current market expectations and above prior year, with free cash flow positive for the year excluding receivable financing movements and year-end leverage between 4x and 4.35x.

Michael Willome framed the quarter as evidence that Synthomer’s specialty transformation is working, emphasizing new products, new markets, and stronger regional reach in China, the U.S., and the Middle East. He said the company is becoming more specialty weighted, more geographically balanced, and more streamlined, and that the refinancing plus divestments give it more runway to continue that shift. His tone was confident but measured: he repeatedly said one-off gains from Q2 disruption should not be assumed to recur, while stressing that recurring self-help and strategic growth are sustainable.

Iain Torrens highlighted that the continuing business generated GBP 954 million of revenue and GBP 14 million of EBITDA growth, with around GBP 8 million of the improvement estimated to be recurring. He pointed to H1 special items of GBP 36.4 million, year-end net debt of GBP 671 million, leverage of 4.9x, and nearly GBP 270 million of committed liquidity. He also said H1 CapEx was GBP 33.5 million, full-year CapEx should be around GBP 70 million, and free cash flow should be positive for the full year excluding factoring movements, with year-end leverage expected at 4x to 4.35x.

Analysts focused on whether the Q2 uplift tied to Iran-related supply disruption and competitor force majeure would repeat, and management said it would not be relied on in H2, though they did not expect it to reverse sharply. Questions also probed the factoring balance, with management explaining that receivable financing is used as a cheaper funding source and that the headline utilization reflects higher invoice values from raw material inflation; they said it is flexible and could be extended modestly. Other questions covered CCS growth drivers, where management said data centers, energy solutions, and medical/nonwoven applications were meaningful contributors, and reliability issues in Adhesive Solutions, which management estimated cost about GBP 10 million in gross margin and said should be fixed in H2.