SIG has warned profits will fall this year as weak construction markets continue to weigh on trading, prompting the building products group to launch a major recovery plan aimed at rebuilding earnings and strengthening its balance sheet.<\/p>\n
The Sheffield-headquartered supplier of insulation and specialist building products said first-half like-for-like sales fell 1.5%, with underlying operating profit expected to come in at around \u00a310m, down from \u00a315m a year earlier.<\/p>\n
Trading improved through the second quarter, with like-for-like sales returning to 1% growth after a difficult start to the year, but the board said it no longer expects any meaningful recovery in its core markets during the second half.<\/p>\n
As a result, SIG has downgraded expectations for the full year, forecasting underlying operating profit of around \u00a325m.<\/p>\n
The company blamed the weaker performance on continued challenging market conditions across its key European territories, compounded by poor weather at the start of the year.<\/p>\n
Net debt stood at \u00a3532m at the end of June, including lease liabilities, although the group said liquidity remained strong at \u00a3154m, despite building inventory ahead of anticipated raw material price increases.<\/p>\n
With market conditions expected to remain subdued into 2027, SIG is now taking matters into its own hands.<\/p>\n
The group has unveiled a wide-ranging improvement programme designed to generate at least \u00a3100m in cash through business simplification, asset disposals, operational improvements and tighter working capital management.<\/p>\n
Management is also targeting a \u00a350m annualised improvement in operating profit run rate by the first half of 2028, signalling a significant restructuring effort rather than relying on a cyclical recovery in demand.<\/p>\n
Further details of the turnaround strategy will be unveiled alongside the group’s interim results on 4 August.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Sheffield-based construction supplier has cut its full-year profit outlook after a tough first half, with bosses unveiling a turnaround programme aimed at generating \u00a3100m in cash and restoring earnings<\/p>\n","protected":false},"author":271992,"featured_media":2153826,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[53262,120781],"coauthors":[137100],"class_list":["post-2157562","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-news","category-markets","tag-featured-story","tag-yorkshire"],"yoast_head":"\n