Profits fall at SIG amid weak markets
Losses at insulation and building supplies group, SIG, have widened amid weak UK and European markets.
The Sheffield-based group said its results reflect a ‘robust trading performance in challenging markets’. SIG added that following a restructure and costing cutting program, profitability will ‘improve when markets recover’.
In the 12 months to 31 December, underlying operating profits more than halved from £53.1m to £25.1m. Total loss after tax was £48.6m compared to £43.4m the previous year. The losses reflected £30.5m of ‘other items’, including £13.4m restructuring cost and £5.3m refinancing costs
Like-for-like were sales over the period down 4%, with revenue coming in at £2.61bn in line with expectations.
Shares in company, which issued a profit warning in June, are down 60% to 11.3p on the same period last year.
Gavin Slark, CEO, said: “We continued to experience lower volumes from weak end-markets across the UK and EU, but we have used this period to reshape our operations, through cost reduction and restructuring actions, and to create better performing businesses across the group. This will help to significantly improve our future profitability when markets recover.
“I am proud of the energy and resilience our people have continued to demonstrate in this tough environment. Across all our operations we are implementing a range of initiatives under our ‘GEMS’ (Grow, Execute, Modernise, Specialise), strategy, which will lead to a higher-value sales mix, continually stronger commercial execution, and more efficient operations, all of which will support delivery of our 5% medium-term operating margin target.
“The operational gearing in our business model applies equally strongly in conditions of rising demand, and, accordingly, the board believes the group remains very well positioned to benefit from the market recovery when it occurs.”
