Insulation industry news from Global Insulation

UK: SIG recorded full-year sales of Euro2.1bn in 2020, down by 13% year-on-year on a like-for-like basis. In the fourth quarter of 2020, sales rose by 5% in the EU, by 2% in the UK and by 4% overall. The group said that this reflects the initial impact of its Return to Growth strategy. The strategy has delivered increased organic sales, supported by ‘robust demand’ in the Repair, Maintenance and Improvement segment. The company noted France and the UK as robust markets within the segment. It said that profitability improved throughout the second half of 2020, with ‘solid’ performance in the EU. Estimated full-year costs were Euro25m.

The group said “Whilst the evolving Covid-19 backdrop will continue to create uncertainty in the short term, the fundamentals of the group’s markets remain sound and the strong recovery in demand across territories and sectors through the second half was encouraging. Providing there is no material disruption to either our business or end markets as a result of the pandemic, the board expects the near-term benefits of the actions taken in 2020 to deliver organic revenue growth in 2021, including market share gains. The benefits of this will become increasingly evident as the year progresses and should enable us to return to underlying operating profitability during the second half.”

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.

UK: SIG has appointed Ian Ashton as permanent group financial officer with effect from July 2020. He succeeds Kath Kearney‐Croft, who assumed the role of Interim chief financial officer (CFO) in late February 2020.

Ashton joins SIG from Low & Bonar, where he has served as group financial officer. Prior to that, he was CFO of Labviva, a US‐based technology company. He worked for 20 years at Smith & Nephew until late 2017, undertaking various financial roles of increasing seniority in the UK, the US and Asia. His last role was CFO, Global Operations, and prior to that Ashton served as CFO of their Advanced Surgical Devices Division. He is a qualified chartered accountant and began his career at Ernst & Young.

The building materials supplier has announced the appointment of Simon King as a non‐executive director. Recently King served on the Travis Perkins executive board and held the position of chief operating officer of Wickes. Prior to that he held various operational roles at Walmart, Savola Group and Tesco.

UK: SIG and Kingspan have agreed to terminate the sale of SIG subsidiary Building Solutions (National) to Kingspan for Euro42.1m. The Competition and Markets Authority (CMA) had referred the deal for a Phase 2 Investigation on 21 April 2020. SIG said that it anticipated the investigation to conclude in October 2020. The deal will expire on 7 July 2020. Due to ‘prevailing market conditions,’ the parties terminated the agreement.

SIG said, “It has not been possible for the company and Kingspan to agree commercial terms for the extension of the agreement.”

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%.

UK: SIG has agreed to sell its Building Solutions division to Kingspan Group for Euro42m. Building Solutions is a UK manufacturer and distributor of building envelope solutions operating through brands including Steadmans, United Roofing Products, Trimform Products, and Advanced Cladding & Insulation. SIG decided to sell the division following a strategic review in 2017. Proceeds from the sale will be used to reduce SIG’s debts.

UK: SIG’s sales for the first half of 2019 have fallen by 3.8% year-on-year due to a ‘marked deterioration’ in the level of UK construction. Its UK and Ireland like-for-like sales dropped by 12.7% while sales elsewhere in Europe grew by 3.3%.

UK: SIG’s revenue fell by 1.2% year-on-year to Euro3.11bn in 2018 from Euro3.15bn in 2017. Its profit before tax increased by 8.5% to Euro87.2m from Euro80.4m. The building materials producer blamed ‘challenging’ market conditions but it highlighted its focus on prices and profitability.

UK: SIG’s revenue fell by 1.2% year-on-year to Euro3.13bn in 2018 from Euro3.17bn in 2017. Its profit before tax rose by 8.5% to Euro87.8m from Euro80.9m. The group blamed its falling sales on ‘challenging’ market conditions and a focus on profit over sales volumes. It reported a weakening construction market in 2018 and its UK and Ireland sales fell by 10.6%. Despite slowing markets in France and Germany, its mainland Europe sales remained stable in 2018.

“As expected, our transformation strategy began to deliver during the year and we saw significant operational and financial progress in the second half. Despite challenging market conditions and lower revenue in our largest markets, our focus on pricing and profitability over volume, coupled with tighter control over operating costs, has enabled us to grow our gross margins and profit,” said chief executive officer (CEO) Meinie Oldersma.

UK: SIG has forecast in a trading update that its sales revenue will fall by 2.3% year-on-year in 2018. It described the UK trading environment as increasingly ‘challenging’ in the second half of 2018 with commercial demand reduced by economic uncertainty, slower house price inflation and falling secondary housing market transactions. Conditions in France and Germany were also reported as slowing down in the second half.