Synthomer PLC (LON:SYNT), today announced results for the year ended 31 December 2018.
Full year highlights:
· Revenue up 9.4% at £1.6bn
· Record Underlying profit before tax, up 3.9% at £135.1m reflecting benefits of geographic diversity and product differentiation
– Asia & Rest of World operating profit 30% higher reflecting further improvement in Nitrile latex volumes and margins
– Europe and North America operating profit 5% lower primarily reflecting USD transactional currency impact (£5.3m)
· The Group absorbed a total of £10.1m of USD currency transactional headwind
· IFRS profit before tax up 39.2% at £120.3m (2017: £86.4m)
· 90ktes Nitrile latex expansion delivered safely, on time and on budget.
· Return on R&D investment: new products represented 21% total sales volumes (2017: 20%)
· Higher Underlying earnings per share: + 6.8% at 32.8p (2017: 30.7p)
· Increased dividend per share: + 7.4% at 13.1p (2017: 12.2p) in line with dividend policy
· Good liquidity and low leverage allow for investment in organic and M&A growth: Net debt: EBITDA at 1.2x
Commenting on the results, Neil Johnson, Synothomer Chairman, said:
“I am pleased to report a year of good progress, highlighted by a fourth consecutive year of growth in Underlying profitability. Progress has been underpinned by capital investment in higher growth markets, a focus on innovation, and our disciplined M&A strategy, overcoming a challenging market environment.
Looking forward, the Group’s leading market positions, incremental low cost production capacity, geographic diversity and product differentiation, ensure we are well placed to navigate the current global political and economic uncertainties. Given this, we are confident of making further progress in 2019 and the Board’s expectations remain unchanged.”
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IFRS Information |
2018 |
|
2017 |
||||
|
|
Underlying performance |
Special Items |
IFRS |
|
Underlying performance |
Special Items |
IFRS |
|
|
£m |
£m |
£m |
|
£m |
£m |
£m |
|
Revenue |
1,618.9 |
– |
1,618.9 |
|
1,480.2 |
– |
1,480.2 |
|
|
|
|
|
|
|
|
|
|
Europe and North America (ENA) |
111.2 |
(19.4) |
91.8 |
|
117.1 |
(39.6) |
77.5 |
|
Asia and ROW (ARW) |
45.7 |
9.2 |
54.9 |
|
35.1 |
(3.9) |
31.2 |
|
Unallocated |
(14.8) |
(3.2) |
(18.0) |
|
(13.2) |
(0.1) |
(13.3) |
|
Operating profit (including share of JV’s) |
142.1 |
(13.4) |
128.7 |
|
139.0 |
(43.6) |
95.4 |
|
Finance costs |
(7.0) |
(1.4) |
(8.4) |
|
(9.0) |
– |
(9.0) |
|
Profit/(loss) before taxation |
135.1 |
(14.8) |
120.3 |
|
130.0 |
(43.6) |
86.4 |
|
EPS (p) |
32.8 |
(3.4) |
29.4 |
|
30.7 |
(8.9) |
21.8 |
|
DPS (p) |
|
|
13.1 |
|
|
|
12.2 |
|
|
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Underlying performance
As more fully described in note 1, the Group’s management uses Underlying performance to plan for, control and assess the performance of the Group. Underlying performance differs from the statutory IFRS performance as it excludes the effect of Special Items, which are detailed in note 1. The Board’s view is that Underlying performance provides additional clarity for the Group’s investors and so it is the primary focus of the Group’s narrative reporting. Where appropriate IFRS performance inclusive of Special Items is also described. References to ‘unit margin’ and ‘margin’ are used in the commentary on Underlying performance. Unit margin (or margin) is calculated as selling price less variable raw material and logistics costs.
