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Synthomer to close SBR plant in Finland

October 26/2020

MOSCOW (MRC) -- Synthomer (Harlow, UK) says it has decided to close its styrene-butadiene-rubber (SBR) production site at Oulu, Finland, by the end of the first quarter of 2021, said Chemweek.

The company confirmed in August that it was in a consultation process with employees at Oulu concerning future options for the facility. Meanwhile, consultations are continuing at Synthomer’s Marl, Germany, SBR site with an outcome expected in the fourth quarter. Synthomer earlier launched a review of its SBR business. The company says it “remains committed” to the SBR market in Europe and is “confident of being able to service customers from its Central European asset base."

Synthomer also says that its new 60,000-metric tons/year nitrile butadiene latex capacity at Pasir Gudang, Malaysia, is on schedule for start-up in the fourth quarter of 2021. The plant’s current capacity is 90,000 metric tons/year. Synthomer made the announcements as part of a recent third-quarter update that it says shows “strong trading momentum across all three business divisions.” As a result, the company has raised its full-year EBITDA guidance by 10%.

Volumes and margins at the company’s performance elastomers business are ahead of the prior-year period reflecting strong demand in nitrile butadiene latex following the COVID-19 pandemic and improved conditions in SBR through the third quarter, the company says. The functional solutions business continued to benefit from the integration of Omnova Solutions and is trading ahead of the year-earlier period although some market sectors are demonstrating stronger resilience than others, Synthomer says. The performance of the industrial specialties business continued to improve in the third quarter following a weaker second quarter impacted by COVID-19. Current run-rate volumes and margins are on or above prior-year levels, the company says.

Synthomer’s revised guidance is for 2020 EBITDA of about GBP232 million (USD302 million), 10% higher than the forecast made in August of GBP211 million, which was at the time broadly in line with analysts’ consensus estimate.

The company says that the integration of Omnova is proceeding ahead of schedule. Synthomer confirms expected synergies leading to annualized cost cuts of USD20 million by the end of this year, up from a previous assumption of USD15 million, and USD40 million by the end of 2022, up from USD30 million.

"This is a very encouraging performance with all business divisions performing ahead of prior year,” says Calum MacLean, CEO of Synthomer. “Alongside this strong momentum, we have made significant strategic progress, with a decision to close our site in Oulu and the integration of Omnova continuing ahead of our initial expectations. This underpins our confidence for the remainder of this year and beyond."

According to MRC's ScanPlast report, September total production of unmixed PVC grew to 86,000 tonnes from 75,500 tonnes a month earlier, SayanskKhimPlast and RusVinyl increased their capacity utilisation. Overall output of polymer were 718,500 tonnes in the first nine months of 2020 versus 720,500 tonnes a year earlier, only two producers raised their production volumes, and RusVinyl cut its output.
Author:Anna Larionova
Tags:butadien, styrene, natural rubber, synthetic rubbers, Synthomer.
Category:General News
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