Synthomer PLC (LSE:SYNN) shares fell 18% after the company struck a guarded tone in its interim results, despite continued earnings growth in difficult markets.
The group reported a 4.1% rise in earnings before interest, tax, depreciation and amortisation to £77.8m, with margins up to 8.4%, helped by a further £17m of cost and reliability improvements in the period.
Revenue for the first half dropped nearly 10% to £925.2m as end-market demand became more volatile, partly in response to recent tariff changes.
The company noted that tariff changes resulted in "greater customer demand volatility" in the second quarter.
Adhesive Solutions stood out, regaining market share and delivering a 62% rise in profits, while Health & Protection also grew. Coatings & Construction Solutions, by contrast, saw profits fall 35% amid weaker demand in energy solutions.
Synthomer said cost actions, including a new £20–25 million programme, are expected to deliver an extra £9m of savings in the second half, helping to offset subdued demand.
Net debt increased to £638.3m, reflecting usual seasonal factors, with further divestments planned as part of a strategic transformation.
The group expects some earnings progress this year and broadly neutral free cash flow, as cost cuts help to mitigate ongoing trade headwinds.
The shares fell 13.9p to 64.9p.