TIDMSHI
RNS Number : 8514P
SIG PLC
12 October 2023
12 October 2023
SIG plc Q3 Trading Update
SIG plc ("SIG", or "the Group"), a leading supplier of
specialist insulation and building products across Europe, today
issues a trading update for the three months to 30 September 2023
("Q3" or "the period").
Key points
-- Group like-for-like(1) ("LFL") revenue for the period down 2% versus prior year
-- Market conditions remain challenging, with a further
softening in demand in September, most notably in new build
residential segments across all geographies
-- H2 2023 profitability benefiting from ongoing productivity
initiatives, including early impact of restructuring actions
already executed
-- In light of the weaker short term demand outlook, the Board
now expects the Group to deliver full year underlying operating
profit(2) in the range of GBP50m to GBP55m
Trading Summary
Group LFL revenue was down 2% year-on-year in the period, and is
down 1% for the nine months to 30 September 2023. Sales prices and
volumes were lower than expected in the period, with the overall
impact of input cost inflation on Group revenue growth estimated to
have been neutral, and sales volumes 2% down.
1 July to 30 LFL GBP'm
September growth
Revenue
UK Interiors (3)% 189
UK Exteriors 0% 115
UK (2)% 304
------------------- -------- ------
France Interiors (2)% 48
France Exteriors (4)% 95
Germany (1)% 117
Poland 7% 68
Benelux (8)% 25
Ireland (13)% 24
EU (2)% 377
------------------- -------- ------
Group (2)% 681
------------------- -------- ------
Market conditions remained challenging across all our
geographies. Whilst the year-on-year volume performance in H2 has
improved from H1, as expected due to prior year comparators, the
extent of this has been less than anticipated, with a notable
softening in demand in September. Although this applies to most
segments, it has been most marked in new build residential in all
markets. We believe we are continuing to outperform the markets in
which we operate, reflecting the strengthened performance across
our branch network over the last two to three years. Working
capital and capex remain tightly managed across the Group.
Outlook
We expect weaker demand conditions to persist through the rest
of the year, with a negligible impact overall from input price
inflation or deflation. Our second half profitability is
benefitting from ongoing productivity initiatives, including the
early impact of already executed restructuring actions that will
deliver GBP4m of annualised benefits. These include a streamlining
of central costs and a review of certain OpCo cost structures,
notably in the UK. We also expect a profit of cGBP3m on one
specific property move in France, as previously reported. Despite
the positive early impact of these initiatives, the lower than
anticipated sales mean that the Board now expects the Group to
deliver full year underlying operating profit in the range of
GBP50m to GBP55m.
Notwithstanding short-term market weakness, we continue to
progress the strategic and operational initiatives which underpin
our ambition for the Group. We remain confident in our ability to
further improve our market positions, and to continue to improve
our profitability when market conditions recover. We will present
on these topics at our Capital Markets Event on the afternoon of 23
November 2023.
1. Like-for-like is defined as sales per working day in constant
currency, excluding completed acquisitions and disposals
2. Underlying represents the results before Other items. Other
items relate to the amortisation of acquired intangibles,
impairment charges, profits and losses on agreed sale or closure of
non-core businesses and associated impairment charges, net
operating profits and losses attributable to businesses identified
as non-core, net restructuring costs, and other non-underlying
profits or losses.
Contacts
SIG plc +44 (0) 114 285 6300 /
ir@sigplc.com
Gavin Slark Chief Executive Officer
Ian Ashton Chief Financial Officer
Sarah Ogilvie Head of Investor Relations
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
Investec Bank plc - Joint broker
to SIG +44 (0) 20 7597 5970
Bruce Garrow / David Anderson
LEI: 213800VDC1BKJEZ8PV53
This announcement contains inside information for the purposes
of UK MAR. The person responsible for arranging the release of this
announcement on behalf of SIG is Andrew Watkins, Group General
Counsel & Company Secretary.
Cautionary Statement
This document contains certain forward-looking statements
concerning the Group's business, financial condition, results of
operations and certain Group's plans, objectives, assumptions,
projections, expectations or beliefs with respect to these items.
Forward-looking statements are sometimes, but not always,
identified by their use of a date in the future or such words as
'anticipates', 'aims', 'due', 'could', 'may', 'will', 'would',
'should', 'expects', 'believes', 'intends', 'plans', 'potential',
'targets', 'goal', 'forecasts' or 'estimates' or similar
expressions or negatives thereof.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors, which may cause the Group's actual
financial condition, performance and results to differ materially
from the plans, goals, objectives and expectations set out in the
forward-looking statements included in this document.
All written or verbal forward-looking statements, made in this
document or made subsequently, which are attributable to the Group
or any persons acting on its behalf are expressly qualified in
their entirety by the factors referred to above. Accordingly,
readers are cautioned not to place undue reliance on
forward-looking statements. No assurance can be given that the
forward-looking statements in this document will be realised;
actual events or results may differ materially as a result of risks
and uncertainties facing the Group. Subject to compliance with
applicable law and regulation, the Group does not intend to update
the forward-looking statements in this document to reflect events
or circumstances after the date of this document and does not
undertake any obligation to do so.
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END
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