LONDON (ShareCast) - (Sharecast News) - British chemicals business Synthomer warned on Friday that its full-year underlying pre-tax profits would fall short of market expectations if depressed European industrial activity and increased political and economic uncertainties continued in the fourth quarter.
Synthomer said growing weakness in the global economy had created a "more challenging backdrop" for the chemical industry, resulting in an overall slower trading environment throughout the third quarter.

However, the FTSE 250 company said its Nitrile Butadiene Latex unit had another positive quarter, with continued growth supported by the additional 90 kilotonnes of capacity introduced during Q4 2018.

In SBR, Synthomer said the challenging conditions in Europe highlighted in its interim results had not improved during the quarter and also cautioned that its paper segment had continued to remain "particularly weak".

Whilst Synthomer said it continued to benefit from its "strong product portfolio", end market diversification and geographic presence, the slower trading environment was expected to continue through the remainder of the year and into 2020, particularly in Europe.

"If the current weakness in macroeconomic conditions persist through Q4, excluding any impact from the potential acquisition of Omnova, the board expects underlying profit before tax for FY 2019 to be approximately 10% below 2018 and accordingly current consensus expectations," said Synthomer.

Synthomer said the Omnova acquisition remained subject to regulatory approval from European and Turkish competition authorities and the deal should complete late this year.

As of 0830 BST, Synthomer shares had crashed 12.53% to 270.80p.

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