Synthomer (LON:SYNT) reported its 2025 full-year results, with management emphasizing margin improvement, positive free cash flow, and a refinancing that extends debt maturities to 2029. CEO Michael Willomeit said the company delivered performance “fully in line with our January 29 winter trading statement,” despite another year of lower end-market demand and disruption from global tariff changes introduced in the second quarter.
2025 results: lower revenue, steadier earnings and improved margins
CFO Lily Liu said revenue for the continuing business fell 9.9% on a constant-currency basis to GBP 1.74 billion, driven by a 7.2% volume decline tied to weaker demand after tariffs and “ongoing competition from Asian companies in base chemical areas.” Despite the revenue decline of “nearly GBP 200 million year on year,” Liu said EBITDA decreased by only GBP 6.5 million, supported by self-help actions.
Underlying operating profit for continuing operations was GBP 37.6 million, down 21%. Underlying finance costs rose 6.5% as a higher coupon on a new bond was partly offset by lower base rates. Liu reiterated a guided underlying effective tax rate of around 25% but said 2025’s ETR was “significantly outside of this normal range” due to a one-time adjustment to deferred tax assets in the U.S. and U.K. and the geographic mix of profits and losses.
William Blythe, classified as discontinued operations, contributed GBP 3.6 million of EBITDA up to its divestment in May 2025. Total group underlying loss per share was GBP 0.372, compared with a GBP 0.025 loss in 2024; Liu said about half of the deterioration reflected the derecognition of U.S. and U.K. tax losses “which the company can access to in the future.”
Divisional performance: strength in Adhesive Solutions, pressure in CCS and HPPM
In Coatings & Construction Solutions (CCS), revenue declined to GBP 699 million, down 11.6% on constant currency. Volume fell 6.8%, which Liu said reflected tariff-driven uncertainty and a tougher comparison to a prior year that included a stronger coatings season. She cited the largest headwind as lower oil and gas drilling activity, which reduced orders in the “high-margin Energy Solutions segment.” CCS EBITDA fell to GBP 64 million, down 25% on constant currency, with an EBITDA margin of 9.2%. Liu said CCS delivered GBP 13 million of cost savings in 2025, with more expected in 2026.
Adhesive Solutions (AS) posted a turnaround that management highlighted as a core strategic proof point. Liu said AS EBITDA rose 39.5% on constant currency and the EBITDA margin improved 350 basis points to 11.6%, compared with around 5% in 2023. Revenue decreased 1.5% on constant currency, partly due to a shutdown and site reliability issues at a third-party managed site, which Liu said is improving. She said AS delivered around GBP 11 million of operational efficiency and cost savings in 2025.
Health & Protection and Performance Materials (HPPM) saw revenue fall 16.5% on constant currency, with volumes down 10.4% and additional impact from lower raw-material prices. In Health & Protection, nitrile butadiene rubber (NBR) volumes fell 17.3%, with muted demand early in the year tied to pre-buying in 2024 ahead of U.S. PPE tariff changes in January 2025; Liu said volumes began to improve in the fourth quarter. She also said the Iran war had a positive effect on margin, and noted additional income from a U.S. technology partner supported by Synthomer as it builds a new U.S. NBR plant. HPPM EBITDA was GBP 24 million, with a margin of 5.2%.
Cash flow, net debt and refinancing: maturity extended to 2029
Management said the group delivered positive free cash flow in 2025, with a second-half inflow “as expected.” Net debt ended the year at GBP 575 million, down GBP 22 million versus FY 2024 and down GBP 63 million versus the 2025 half-year, which Liu attributed to cash management. Leverage was 4.7x and “well within the covenant.”
Willomeit said Synthomer refinanced its bank facilities, extending maturities from mid-2027 to Q1 2029, and resetting covenants. Liu said the refinancing extended the maturity of the RCF and EUCAP facilities to the end of February 2029 and introduced quarterly covenant testing on leverage plus a minimum liquidity covenant.
Liu guided P&L interest expense of around GBP 70 million in 2026, reflecting the refinancing. She said cash interest would be lower by “mid-single digit GBP millions.” She also reiterated the company’s deleveraging priority toward a medium-term target of 1x–2x and said the board confirmed the dividend will remain suspended until leverage falls below 2.5x.
On working capital and receivables financing, Liu said 2025 benefited from an inflow tied to higher utilization of receivables financing and a GBP 50 million one-time receivables purchasing arrangement (KLK). For 2026, the company expects “broadly neutral free cash flow” after accounting for the unwind of that GBP 50 million, which she said was completed by early March.
Strategy, divestments and cost actions
Willomeit said the company will “stick to our strategy” of focusing on differentiated specialty products and continue a divestment program aimed at accelerating deleveraging and simplifying the portfolio. William Blythe was divested in the first half of 2025, the third divestment since 2022. The company said it has four formal divestment processes underway. On the call, Willomeit described an indicative timetable: one process that could conclude “rather sooner than later,” two “in the next few months,” and one extending into the second half, while stressing the company would not make “bad deals” and would focus on valuation and transaction terms.
He also pointed to GBP 30 million of operating cost savings delivered in 2025 and said Synthomer expects a further GBP 20 million–GBP 25 million of incremental gross benefits in 2026. Willomeit emphasized the shift toward specialties as a driver of improved group profitability, saying group gross margin has increased 500 basis points over four years to “over 40% in the last quarter.”
In updates by division, Willomeit said CCS implemented cost and capacity actions including temporarily idling capacity, reducing shift patterns, and reviewing operating costs and headcount, alongside inventory measures to support cash flow. In AS, he highlighted a performance improvement program launched in 2023 that has delivered GBP 35 million in cumulative benefits to date and now targets at least GBP 40 million by the end of 2026. He also said AS specialty exposure is now 60% of divisional revenue and referenced a partnership and supply agreement with Henkel and the launch of “CLIMA” branded products with at least a 20% cradle-to-gate reduction in certified carbon footprint.
2026 trading: improved momentum, upside risk noted but guidance unchanged
Willomeit said trading in the first quarter of 2026 was in line with expectations and ahead of the prior year, with “improving momentum through the quarter,” and a “highly promising” start to the second quarter. He said Synthomer is passing through increases in raw material costs via pricing, while volumes are increasing in many areas due to disruption to competitors’ networks, particularly in Asia. He added that the geopolitical environment remains volatile and demand impacts from prolonged disruption are uncertain, so the company is making no change to its 2026 outlook “at this stage,” though he said the risks are “to the upside.”
In Q&A, Willomeit said the NBR situation “looks very good,” noting Synthomer had raw materials while others were struggling, and said margins could potentially “double or triple” in a tight market, though he cautioned it remained to be seen. He also said the company continues to evaluate its portfolio, describing NBR as a base-chemicals business and noting improved performance could make it “more interesting for potentially better owners.”
On April trading, Willomeit said volumes and margins looked “very good” across all three divisions. He attributed the company’s ability to capitalize on conditions to its “world-class procurement,” regional manufacturing footprint, and improvements achieved over the past three and a half years.
The company also announced a leadership change: Willomeit said CFO Lily Liu has accepted a CFO role at Umicore, and that Iain Torrance, most recently interim CFO and then CEO of Wood Group, will join as interim CFO while Synthomer searches for a permanent successor.
About Synthomer (LON:SYNT)
Synthomer plc is a leading supplier of high-performance, highly specialised polymers and ingredients that play vital roles in key sectors such as coatings, construction, adhesives, and health and protection – growing markets for customers who serve billions of end users worldwide.
Headquartered in London, UK and listed on the LSE since 1971, we employ c.3,800 employees across our five innovation centres of excellence and 29 manufacturing sites across Europe, North America, Middle East and Asia.
