Synthomer Share Discussion Threads

[robsy2] 29/3/2022 08:23

I’m in. A very juicy dividend coming shortly.

[the white house] 11/3/2022 16:41

As the statement says ExceptionalExceptionalExtraordinary Exceptional

[grahamburn] 11/3/2022 15:18

Is it really worth a long post of last year's figures when this year's finals were published a week ago?

Synthomer's market has changed significantly post-covid while the company is a different beast having acquired Eastman's business recently.

[km18] 11/3/2022 13:22

...from last year...

Company overview:
Synthomer is a specialist chemical company and one of the world’s foremost suppliers of polymers. Headquartered in London, the company operates globally through more than 4000 employees across 38 sites. The company’s diversified portfolio of products serves customers in various sectors, such as adhesives, construction, textiles, energy, paper, coatings etc. In April last year they acquired OMNOVA solutions, a US based specialty chemical company. The transaction resulted in a global specialty chemicals specialty with significant scale. SYNT’s biggest benefit is probably  the material strength on the US market combined with penetration of the Chinese market, from the acquisition.
Growth is following a blended approach with several acquisitions over the last decade and constant investments in innovation. This is confirmed by the 20% of revenue arriving from products less than five years old.
The company’s portfolio provides a diversified exposure to various sectors, such as Health & Protection, Carpets, Paper, Adhesives, coating, Oil & Gas etc. Performance Elastomers and Functional solutions (OMNOVA CAST is dealing in the latter) brought around 80% of the revenue in 2020 with a total of $1.327bn. Markets where the Group operates are growing consistently and the acquisition of OMNOVA generated $30m of synergy savings run rate achieved by the end of 2020. The year saw record EBITDA at £259.4 million (45.8% growth) with 14% CAGR over the period 2014-2020.
Latest interim updated delivered sky high figures driven by strong demand for nitrile products, which are used in PPE for healthcare providers. The strong performance is based on the fact that the Group was part of an essential industry very early on in the pandemic, meaning their sites ran uninterrupted. The Performance Elastomers quadrupled cash profits and operational gearing went into overdrive. Working capital was affected by inflation in prices, but the demand outbalanced the price impact and kept WC/Total sales at 10%. The only thing which weakens the view is the impairment of £22.5m, but hey, we always said – if you are pursuing a growth through acquisitions strategy, brace yourself, as the fair value is rarely achieved in these transactions. Management expects normalized demand in Q3. Following the recent impairments, the outlook for these looks stress free, but we will monitor it closely as the intangibles account for £839m of the assets.

Short analysis:

Cash went up by 36%, from strong performance
Net debt positive as cash did not cover debt levels
CA/CL =  1.6
Cash ratio = 0.50
Interest coverage (FY 2020) =
P/S TTM= 1.08, which is way better than industry average
BV ps TTM = 190, growing at 16.1% CAGR
Operating profit for the interim was £288.6m, 4 times more than H1 2020...

...from WealthOracleAM

https://wealthoracle.co.uk/detailed-result-full/SYNT/91

[le4r] 09/3/2022 13:52

Three NED buys in the last couple of days - first was just small change, then a reasonable c50k chunk and now a 614k position... hardly chicken feed! Hopefully their enthusiasm to load up indicates they also think this valuation is just plain silly...

[deadly] 03/3/2022 08:48

Crazily low valuation here now.

[james dean] 03/3/2022 08:27

Pleasing IMHO

Commenting, Michael Willome said:

"This has been an extraordinary year of outperformance for Synthomer. Record financial results alongside further strategic and operational progress is testament to the outstanding dedication of our employees, the strength of our portfolio and Synthomer's leading market positions globally. All areas of the business have had an excellent year, led by Performance Elastomers and unprecedented Nitrile latex demand due to the pandemic. We have taken full advantage of strong profits by acquiring Eastman's Adhesive Resins business and to support further investment in capacity, initiatives that will deliver significant benefits in the years ahead. With the market returning to more normalised growth conditions, the Group's prospects remain very attractive and we look forward to making progress in the year ahead."

[tightfist] 03/3/2022 08:09

Intrigued by the headlines of morning's FY results, and the forecast trajectory. The PI World video (post #535) is a great briefing, form 26 - 47 minutes, especially the last half, tightfist

[hatfullofsky] 14/1/2022 18:35

Cyclical stock, fear of reduction on PPE contract

[dippydodaa] 14/1/2022 14:04

surprised by how low this keeps going, as a holder i dont quite follow the rationale here.

[tomps2] 14/1/2022 09:33

Daniel Jones Pitches #SYNT in the latest episode of PIWORLD's Sell it to the City.

Daniel Jones pitches Synthomer (SYNT) to Andy Brough, Schroders, Judith MacKenzie, Downing and Stephen English, Stellar Asset Management in the second episode of PIWORLD's Sell it to the City.

Watch the video here: Https://www.piworld.co.uk/education-videos/piworld-sell-it-to-the-city-january-2022/

Or listen to the podcast here: Https://piworld.podbean.com/e/piworld-sell-it-to-the-city-january-2022/

[james dean] 11/1/2022 19:06

I agree with your thinking.

[hatfullofsky] 11/1/2022 18:46

Well, I'm in now. Think we'll see a little bounce on the trading update followed by a rise back to the old trend line

[tomps2] 17/12/2021 09:58

PIWORLD interview with Richard Leonard: Winners and Losers of 2021

02:24 What went badly: Synthoma #SYNT

Video: Https://www.piworld.co.uk/education-videos/piworld-interview-with-richard-leonard-winners-and-losers-of-2021/

[deadly] 07/12/2021 11:50

Predictable bounce today but still much further to go.

[tole] 07/12/2021 07:57

https://www.fool.co.uk/2021/12/06/why-is-the-synthomer-lsesynt-share-price-down-14-today/

[podgyted] 06/12/2021 14:28

MS clients obviously didn't get as many shares as they wanted.

[libertine] 06/12/2021 14:01

Institutional Placing at 485p just over a month ago?

[kinwah] 06/12/2021 10:04

I suppose looking at the one year chart you could say with hindsight that a pull back to around 433p was inevitable. Probably next year there is going to be the oversupply of nitrile that was threatened pre-Covid. The whole point of the Eastman acquisition though is to dilute the effect of the end of the nitrile superprofits. I can see potential for bumpier trading conditions next year but I think SYNT remains a great long-term investment.

[chris79] 06/12/2021 09:51

Just bought - MS say 400p today, Canacorrd said 750p last week. Happy to go in at 433.

[ppreston1] 06/12/2021 09:47

Double downgrade on non-specific news seems a little opportunistic to me. Wouldn't be surprised to see massive buying later once they got it down to their target price. Hound Partners also probably looking to fully close their short position which is now below 0.5%.

[libertine] 06/12/2021 09:18

Morgan Stanley double downgrade this morning price target 400p

[texaspete2] 06/12/2021 09:16

No significant movement elsewhere in the sector, if anything they are mostly up today. I have noted the lack of a q3 trading update, was one in October last year

[clanger66] 06/12/2021 09:11

Morgan Stanley cut to underweight could be responsible.

[kevph] 06/12/2021 09:07

No idea. Anyone in this sector reporting?