Pilkington parent, NSG, returns to profit but global markets remain tough

NSG (Nippon Sheet Glass), the Japanese parent of St Helens glass giant Pilkington, has returned to profit, its annual figures have revealed.

It declared revenues of £4.263bn for the year to March 31, 2024, up from £4.182bn the previous year.

And a pre-tax profit of £90.11m represented a turnaround from a pre-tax loss of £120.16m in 2023, mainly due to rising energy costs.

The group said it experienced a further deterioration in certain key markets during the fourth quarter of the year.

In particular, the group’s largest Architectural markets in Europe were increasingly challenging. Automotive markets continued to gradually recover, with volumes benefiting from a return to more normal conditions, following a long period of challenges within the supply chain.

Technical glass markets were relatively weak across many areas, although some markets showed signs of improvement.

The improvement in revenues was mainly from within the Automotive business.

Architectural, representing 45% of cumulative revenues, includes the manufacture and sale of flat glass and various interior and exterior glazing products within the commercial and residential markets. It also includes glass for the Solar Energy sector.

In Europe, representing 38% of the group’s architectural sales, revenues and profits were below the previous year as volumes and prices reduced in line with deteriorating economic activity during the second half of the year. The impact of the weaker market conditions was mitigated, somewhat, by a decrease in input costs.

Automotive, with 50% of cumulative revenues, supplies a wide range of automotive glazing for new vehicles and for replacement markets.

Europe represents 42% of the group’s Automotive sales. Revenues improved, with increased input costs being partially recovered from customers. Volumes benefited from improving vehicle sales, together with a replenishment of vehicle inventory at customers and distribution networks, with supply chain constraints continuing to ease.

Technical Glass, representing five per cent of cumulative revenues, comprises several discrete businesses, including the manufacture and sale of very thin glass used as cover glass for displays, lenses and light guides for printers, and glass fibre components for engine timing belts.

Forecasts for FY2025, are for a full year turnover of £4.301bn, and £66.57m in pre-tax profits.

The group expects revenues to be higher, mainly due to the impact of foreign exchange movements.

The profit forecast reflects relatively challenging market conditions during the first half of the year, with a recovery being experienced from the second half of the year.

It anticipates a reduction in Architectural profitability, offset by a further improvement in Automotive.

In February this year production ceased at Pilkington’s 200-year-old glassworks which pioneered the modern method of glass manufacturing used around the world to this day.

As part of a major investment project, production at the Watson Street Works in St Helens, which opened in 1826, ceased and production will be transferred to a nearby sister plant, which is expected to begin production in August this year.

Watson Street Works is where Sir Alastair Pilkington invented the modern float glass process, which revolutionised the way flat glass was produced. The site will remain open over the next year for warehousing and logistics.