Kingspan reports strong first-half growth

Insulation and building materials company Kingspan reported a 42% improvement in first-half revenue on Friday, to €4.2bn, with growth of 27% on an underlying basis.

The London-listed firm said trading profit was ahead 32% year-on-year for the six months ended 30 June to €434.2m, or 15% on an underlying basis.

Group trading margin was 10.5%, which was a decrease of 80 basis points against the same period in 2021.

Kingspan said acquisitions contributed 12% to its sales growth and 13% to trading profit growth in the period, while its net debt widened to €1.21bn from €601.7m year-on-year.

Net debt-to-EBITDA was 1.25x, compared to 0.83x at the end of the first half last year, while basic earnings per share were up 29% to 170.6 euro cents.

The board hiked the interim dividend by 29% to 25.6 cents, in line with its policy guidance, while return on capital employed came in at 18.1 %, down from 18.9% a year ago, which was put down to the timing of acquisitions.

“Despite a challenging trading environment Kingspan delivered record half year results, with revenues over €4bn for the first time,” said chief executive officer Gene Murtagh.

“We have been able to navigate large input cost increases with only modest margin impact.

“We invested €522m in new businesses and capex in the period, including significant progress executing on our strategy of developing a new business division focussed on roofing and waterproofing solutions.”

Murtagh said the company was also continuing its organic expansion plans, with the intention to build 25 new production lines in the next five years, including plans to invest €200m in a new building technology campus in Ukraine.

“Looking forward, we retain the outlook flagged in our June trading update but are confident in the long term demand for the energy efficient solutions we deliver.

“Whilst inflationary pressures have eased in recent months, the context of energy supply constraints over the winter months in Europe will be something we will be closely monitoring.”

At 1031 BST, shares in Kingspan were up 6.48% in London, at €61.76.

Reporting by Josh White at Sharecast.com.