SIG musters with investors in Sheffield

Building products distributor SIG was meeting with investors in Sheffield on Thursday, as it updated the market on a year that has so far seen growth.

The FTSE 250 firm said group revenues increased 9.3% in the year to 30 April, with acquisitions contributing 4.9%, currency 3.0% and working days 0.2%. Like-for-like sales were up 1%.

Reported revenues in the UK and Ireland were up 9.1%, with like-for-like sale up 2.8%.

Like-for-like revenues in the insulation and interiors division, SIGD, were ahead 3.1% as the group continued to benefit from increased customer focus and a resilient new build residential market in the UK.

Like-for-likes in its exteriors business were down 1.0%, which was an improvement on recent quarters, suggesting the market was stabilising.

In mainland Europe, reported revenues were up 9.6%, though like-for-likes were down 1.0%. Like-for-like sales in France were down 3.1%, with the company saying the trajectory of the recovery in the construction market there was still uncertain.

SIG’s German business saw like-for-likes decrease as well, by 1.0%, while there was positive growth in its other mainland markets of Ireland, Benelux and Poland.

The company said its gross margin continued to benefit from procurement savings, increasing by 20 basis points overall for the period, adding to the 40 basis point improvement already seen in the prior two years.

“While the group has made a reasonable start to the year, with the key summer and autumn trading periods yet to come, construction markets in Mainland Europe remain uncertain and competitive pressures persist,” SIG’s board said in a statement.

“However, SIG continues to make progress on its initiatives to improve business performance and has a high degree of confidence in achieving its 2016 targets of a net incremental benefit of £3m in supply chain and at least £10m in procurement.

“Based on these management actions, together with the opportunities for growth, particularly in its value added businesses, SIG continues to expect to make progress in 2016 in line with its previous expectations,” it explained.