Insulation industry news from Global Insulation

UK: SIG’s group revenue fell by 37% year-on-year to Euro154m during March and April 2020 due to disruption caused by the coronavirus outbreak. In its annual report for 2019 the insulation producer said that trading had returned to pre Covid-19 levels in most of its companies as it adapted social distancing measures. It also reported cash reserves of around Euro150m following the sale of its Air Handling division.

In 2019 the group‘s statutory revenue fell by 13% year-on-year to Euro2.4bn in 2019 from Euro2.7bn in 2018. It made an operating loss of Euro97m. This was blamed on loss of market share in the UK and Germany. In response the company’s board says it taken ‘decisive’ action including appointing a new leadership team and developing a new customer-centric strategy that reprioritises sales.

Denmark: Rockwool’s insulation sales declined by 0.6% year-on-year to Euro483m in the first quarter of 2020 from Euro486m due to slowdowns in Asia, in technical insulation sales and in its sandwich panel business. Despite this its earnings before interest and taxation (EBIT) rose slightly to Euro56m. Overall the group’s net sales and EBIT rose slightly to Euro649m and Euro80m respectively.

“Despite turbulence from the COVID-19 pandemic whose impact we began to feel late in the quarter, we achieved solid first quarter results. Climate change isn’t going away, however. Energy renovation is a high-impact economic recovery measure that creates local jobs, a more resilient and healthy society while at the same time contributing to reaching long-term global climate ambitions,” said chief executive (CEO) officer Jens Birgersson.

The group reported that, due to coronavirus, its sales were affected in Asia and started to decrease during the last weeks of March 2020 in southern Europe. In China, production lines were temporarily closed early in the quarter and re-opened four weeks later. Factories in Malaysia, India, France and Spain were closed at different times in March 2020. It said that all these factories had now partly resumed production. The company is planning to adjust operations based on reduced demand and a decline in construction spending in future quarters. It also intends to seek, “market opportunities resulting from political and fiscal responses to drive economic recovery.”

Ireland: Kingspan Group’s sales fell by 3% year-on-year to Euro1.03bn in the first quarter of 2020. It said that the coronavirus-related lockdowns did not ‘significantly’ impact activity for most of the reporting period although the, “landscape changed markedly from the middle of March onward.” The UK and Germany reported improvements, the Americas did well and both Australasia and the Middle East saw rising orders. Insulation board sales were strongly impacted by falling prices. Looking forward the group said that its global sales fell by nearly 35% year-on-year as various construction markets were closed down.

US: Huntsman’s first quarter net income was US$708m in 2020, up by 440% year-on-year from US$131m in 2019. It made sales worth US$1.59bn over the period, down by 4.6% year-on-year from US$1.67bn in the corresponding period of 2019. Polyurethane (PU) insulation sales decreased slightly due to ‘decreased demand across most major markets, partially offset by modest growth in polyisocyanurate (PIR) insulation sales volumes.

Huntsman chair, president and CEO Peter Huntsman said, “We have been well-prepared for this global economic crisis. Our balance sheet is stronger than ever before, with significant cash and robust liquidity. Having learned from prior crises, we pre-emptively reduced unnecessary inventories and are reducing capital spending this year by 30%, or approximately $90m, by delaying discretionary spending.”

US: Owens Corning has recorded a first quarter loss of US$916m in 2020, compared to a US$44.0m profit in the corresponding period of 2019. Net sales were US$1.60bn, down by 4.0% from US$1.67bn. Insulation sales grew by 2.0% to US$603m (38% of net sales) from US$591m. The insulation section’s negative balance of earnings before interest, taxation, depreciation and amortisation (EBITDA) decreased by 71% to US$10.0m US$34.0m.

Owens Corning chairman and CEO Brian Chambers said, “I’m very proud of our team’s strong execution and ability to deliver our first-quarter results in the face of the Covid-19 pandemic. Our long-standing commitment to safety remains at the forefront of everything we do while serving the needs of our customers, our communities, and other key stakeholders.”

Belgium: Recticel has recorded sales of Euro298m in the first quarter of 2020, down by 6.2% year-on-year from Euro318m in the corresponding period of 2019. Recticel said that sales in the first two months of 2020, “remained in line with the previous year despite the impact of the coronavirus crisis on sales and operations in China.” Sales in March 2020 fell by 17% month-on-month, “due to the outbreak and the resulting governmental lockdown measures in most countries.” Insulation sales fell by 2.9% to Euro60.7m Euro62.5m. Recticel said, “Lockdown measures led to a reduction of construction activities as of mid-March 2020. Our insulation plants continued (reduced) operations in all countries except in France where construction activity was halted since mid-March 2020.”

France: Saint-Gobain’s net profit in 2019 was Euro1.45bn, up by 207% year-on-year from Euro474m in 2018. Its net sales were Euro42.6bn, up by 1.9% from Euro41.8bn in 2018. Saint-Gobain chairman CEO Pierre-André de Chalendar praised the year’s performance in spite of a ‘less supportive market environment in the second half.’ He said, “For 2020, in a more uncertain market environment, Saint-Gobain should continue to benefit from its attractive positioning and from the results of its ‘Transform & Grow’ initiative, and is targeting a further like-for-like increase in operating income with an uncertainty about the impact of the coronavirus.”

Denmark: Rockwool’s post-tax profit for 2019 was Euro285m, up by 7.5% from Euro265m in 2018. Sales rose by 3.2% to Euro2.8bn from Euro2.7bn. The company’s insulation section saw ‘mixed market conditions’ but ‘showed modest growth’ over the period, thanks in particular to state-supported energy efficiency improvement in construction practices generating increased demand in the South-West Europe region.

Rockwool said that it invested in long-term growth, having opened a plant in Romania in late-2019, with a capacity expansion to a German plant due to come online in mid-2020 and a further plant in the US to follow in early 2021. Rockwool Group chairman Henrik Brandt and CEO Jens Birgersson said, “For the fifth year in a row, our customer satisfaction scores increased.” Satisfaction rose by 14% year-on-year.

Switzerland: Sika’s 2019 sales rose by 14% year-on-year to Euro7.50bn from Euro6.56bn in 2018. The year saw seven new plants open and the acquisition of UK-based Parex, China-based Crevo-Hengxin and Canada-based King Packaged Materials. “By consistently pursuing this strategic path we will be able to further exploit the business potential of our markets and generate sustainable, profitable growth,” said Sika CEO Paul Schuler.

UK: SIG has reported a fall in 2019 sales of 6.1% year-on-year to Euro2.95bn from Euro3.13bn in 2018. Total UK and Ireland sales fell by 16%, with a drop of 21% by its distribution division and of 8.6% by SIG Exteriors. Sales in Germany and the Benelux fell by 2.6% and 3.3% respectively, while in France they grew by 2.2% and in Poland by 2.1%. The largest proportional growth came from SIG Air Handling, whose sales grew by 5.6%.