Synthomer increases 2013 full year dividend by 9%

DividendMax Ltd.

Synthomer increases 2013 full year dividend by 9%

Europe and North America (ENA) business impacted by continued weak economic conditions;

21% growth in underlying operating profit in Asia and ROW (ARW) driven by a continued recovery in the Asian nitrile business, which developed ahead of expectations in 2013;

Significant investments in additional capacity and Emerging Markets, combined with continued focus on innovation;

Continued progress driving efficiencies through plant capability improvements and raw material cost management;

Group's executive management team strengthened with new regional VP's in Asia and Europe;

Full year dividend increased by 9% to 6.0 pence on track with the Board's commitment to reduce dividend cover to three times by 2015; and

Strong free cash flow; net debt reduced to £133.6 million (2012: £155.8 million); net debt / EBITDA ratio of 1.1 (2012: 1.2).


Commenting on the results, Adrian Whitfield, Chief Executive Officer, said:

"Synthomer has delivered a resilient performance, against the backdrop of subdued economic conditions in Europe. In Asia, our business has performed well, with our Nitrile business continuing to recover. We have remained focused on strengthening the business, investing in additional capacity, manufacturing and R&D capabilities, in innovation and our people.

Whilst European macroeconomic indicators have started to show some more positive trends, we still see limited evidence of a sustained improvement in trading conditions in Europe. We have seen some signs of modest demand improvement in our European Construction & Coatings, Functional Polymers and Performance Polymers segments in recent months. However, we have entered 2014 with unit cash margins across the ENA business slightly below the 2013 average, and weakening of the Euro through the second half of 2013 will create a year-on-year drag. We expect some further improvement in ARW as the supply demand position in Nitrile tightens and Synthomer continues to benefit from additional capacity and investment.

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