Synthomer sees lower rubber glove production into 2023; FY in line

UK chemicals company Synthomer it still expected low rubber product output levels to continue this year as tough economic conditions persisted into the final quarter of 2022.

The company on Tuesday said macroeconomic conditions through the second half of 2022 reduced demand in its construction and coatings end markets, as previously indicated.

“This was most pronounced in the Group's European businesses, but Synthomer's operations outside Europe including its adhesives division were also affected in the last quarter of the year,” it said in a trading update.

“As previously indicated, whilst underlying end market demand for medical gloves remains robust, the group does not expect the current period of destocking, and hence low nitrile butadiene rubber production levels, to abate before the end of 2023.”

The company guided for full-year revenue of £2.6bn and expected underlying core earnings in the range of £262-268m, in line with expectations as set out in mid-December 2022 and company-compiled consensus of £268m. Net debt was just over £1bn as at December 31, 2022.

Reporting by Frank Prenesti for Sharecast.com