SIG PLC Trading Statement (5401X)
May 05 2021 - 2:00AM
UK Regulatory
TIDMSHI
RNS Number : 5401X
SIG PLC
05 May 2021
5 May 2021
SIG plc: Positive Trading Momentum
SIG plc ("SIG", or "the Group") today issues a trading update
for 1 January to 30 April 2021, in advance of its Annual General
Meeting, which is being held on 13 May.
Trading Summary
The Group has made an encouraging start to the year, with the
Return to Growth strategy continuing to deliver good progress and
with trading underpinned by continued strength in RMI demand. After
a solid start in January and February sales volumes then picked up
strongly, and March and April traded ahead of management's
expectations.
Prior year comparative growth rates from late March are
distorted by the impact of Covid, notably in the UK, Ireland and
France, and therefore the table below includes comparisons with
both 2020 and 2019. Performance for the year to date has been ahead
of expectations. Group sales were 29% up on 2020 for the four-month
period. They were 4% lower than the same period in 2019, and flat
against 2019 in March and April.
1 January to 2021 2021 2021
30 April LFL(1) vs 2020 vs 2019 Jan-April
Sales Growth GBP'm
UK Distribution 40% (24)% 153
UK Exteriors(2) 57% 10% 128
UK 47% (12)% 281
---------------------- --------- --------- -----------
France Distribution 44% 8% 65
France Exteriors 41% 13% 127
Germany 6% (3)% 123
Benelux (2)% (11)% 31
Poland 10% 12% 51
Ireland 1% (27)% 22
EU 19% 2% 419
---------------------- --------- --------- -----------
Group 29% (4)% 700
---------------------- --------- --------- -----------
The UK Distribution turnaround, focused on delivering
distinctive expertise and superior local service, is progressing
well and is ahead of plan. Customer numbers are rising and we are
regaining market share. The business's sales were on a declining
trend throughout 2019 and most of 2020, and hence the 24% drop
versus 2019 shown above. Daily sales are now showing very
consistent progress, with the improvement accelerating in
March/April, and April sales up approximately a third on the daily
averages seen last summer. Based on current momentum, we expect the
monthly growth figures vs 2019 to turn positive early in the second
half.
The UK Exteriors business is also trading well, benefiting from
the demand environment, with strong growth versus both 2020 and
2019 comparatives.
The French businesses are continuing to perform strongly, and
are also benefiting from strong RMI demand. Germany and Poland are
both performing solidly, with good growth in recent weeks. We have
recently made changes to the commercial leadership in the Benelux
and are confident its performance will pick up over coming months.
Our Ireland business was affected by the significant Government
restrictions imposed on construction from 1 January 2021, and we
are pleased that these are now being eased.
We are seeing signs of shortages of materials in certain areas,
as reported previously, and input price inflation remains
significant in some categories. We have navigated these
uncertainties successfully to date, despite some longer delivery
times.
Outlook
Whilst the evolving Covid-19 backdrop will continue to create
uncertainty in the short term, more so in our EU markets than the
UK, the strong demand across territories and sectors in the first
four months of the year was encouraging and gives the Board
increased confidence for the full year performance.
The momentum we have seen through March and April, together with
improving visibility on the near-term order book, means that we now
expect the Group to deliver an underlying operating profit in the
first half, returning the Group to profitability earlier than
expected.
Given the prevailing macro-economic uncertainties, we retain a
cautious view of the second half at this stage. We do however
continue to expect the second half to be both profitable and cash
generative, and in light of the stronger than anticipated recent
performance we now expect full year revenues to be slightly ahead
of prior expectations, and profits also to be higher than
previously expected.
1. Like-for-like ("LFL") is defined as sales per working day in
constant currency, excluding completed acquisitions and
disposals.
2. UK Exteriors includes the Building Solutions business, as in
the Group's 2020 Annual Report and Accounts.
Contacts
SIG plc +44 (0) 114 285 6300
Steve Francis Chief Executive Officer
Ian Ashton Chief Financial Officer
FTI Consulting +44 (0) 20 3727 1340
Richard Mountain
Peel Hunt LLP - Joint broker to SIG +44 (0) 20 7418 8900
Mike Bell / Charles Batten
Jefferies International Limited - Joint
broker to SIG +44 (0) 20 7029 8000
Ed Matthews / Will Soutar
Cautionary Statement
This announcement does not constitute an offer of securities by
SIG plc. This announcement may include statements that are, or may
be deemed to be, forward-looking statements. By their nature,
forward-looking statements involve risks and uncertainties because
they relate to events and depend on circumstances that may or may
not occur in the future and may be beyond the Group's ability to
control or predict. Forward-looking statements are not guarantees
of future performance. You are advised to read the section headed
'Principal risks and uncertainties' in the Group's Annual Report
and Accounts for the year ended 31 December 2020 for a further
discussion of the factors that could affect its future performance
and the industry in which it operates. Other than in accordance
with its legal or regulatory obligations, SIG plc does not accept
any obligation to update or revise publicly any forward-looking
statement, whether as a result of new information, future events or
otherwise.
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END
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