London – Despite a “solid” first half performance by its nitrile latex business, Synthomer plc’s performance elastomers division has seen sales and earnings decline during the first six months of the year.
The business unit reported an 11% year-on-year decline in earnings (EBITDA) to £47.6 million (€52.5 million), on 7.3% lower sales of £294 million, Synthomer announced 6 Aug.
Volumes declined marginally during the first six months, helped by an increase in demand for nitrile rubber gloves following the Covid-19 pandemic.
Segment earnings fell as the performance of recently acquired Omnova and the company’s styrene butadiene rubber (SBR) businesses were “significantly impacted” by the pandemic, particularly during the second quarter.
According to Synthomer, the majority of Omnova's performance materials division was transferred to its performance elastomers division following the acquisition of the US-based polymer group in April.
The integration, it said, contributed a loss of £3.4 million to underlying earnings of the business unit in the second quarter.
Synthomer's performance elastomers division now includes three former Omnova elastomer sites in Ningbo, China; Caojing, China and Calhoun, Georgia, US.
During the first half, Synthomer said its nitrile latex business benefitted from the additional 90 kilotonnes of capacity introduced in late 2018 in Pasir Gudang site, in Malaysia.
The added capacity. it said, supported a Covid-induced surge in demand for medical gloves and helped increase volumes.
After a solid first quarter performance, SBR latex market conditions were impacted by the pandemic in the second quarter, leading to weaker volumes and margins in the paper, carpet and foam end markets.