Weak European demand hurts profits at chemist Synthomer

 
City A.M. Reporter
BRITISH chemicals maker Synthomer’s pre-tax profit for the first half fell 10.3 per cent, hurt by weak demand in Europe, particularly from the construction industry.

Shares in the company fell yesterday after the company said profit in the second half would be lower than the preceding half due to weak European market conditions.

“The outlook for the year was worse than expected. When you run the numbers, it’s below what they had previously guided. I think consensus forecast has come down on basis of what was said today and that is why the shares are down today,” James Tetley, analyst at N+1 Singer said.

The brokerage cut its full-year profit forecast for the company by five per cent.

Canaccord Genuity cut its full-year earnings before interest and tax estimates by 5.3 per cent to £105.8m.

Pre-tax profit for the six months ended 30 June fell to £48.6m from £54.2m a year earlier. Underlying sales decreased 7.5 per cent to £558.3m.

Operating profit in Synthomer’s European and North American markets fell 14.6 per cent in the first half of the year.