REG - Kingspan Group PLC Kingspan Group - KGP - Trading Statement

KingspanAnnouncement

06/11/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20231106:nRSF4106Sa&default-theme=true

RNS Number : 4106S  Kingspan Group PLC  06 November 2023

Kingspan Group plc

Trading Update

 

6 November 2023

 

Kingspan Group plc, the global leader in high performance insulation and
building envelopes, issues this Trading Update for the period to 30 September
2023.

 

Sales in the nine-month period to 30 September were €6.14bn, down a touch on
the same period in the prior year and in the third quarter. Sales pre currency
and acquisitions were down 7% in the year to date and in the third quarter.

 

At this point in the year, we are on track to deliver a record full year
trading profit, comfortably ahead of 2022.

 

Insulated Panels sales improved sequentially in the third quarter, down 9%,
and by 10% in the first nine months. Third quarter sales volumes were up
mid-single digit globally. Activity in the Americas remains strong overall,
France is robust, the UK market has weakened considerably since mid-year with
central and eastern Europe stable at sluggish levels of activity. Our
innovation agenda continues to progress, notably QuadCore(TM) LEC Panels
attracting interest across all key markets. PowerPanel(®) is on track for
launch in the first half of 2024. Whilst activity levels overall are subdued,
global order placement has been ahead for the last five months in succession.

 

Insulation sales in the first nine months were down 7% and by 10% in the third
quarter. Sales pre currency and acquisitions were down 8% year to date and by
9% in the third quarter. Board sales volumes recorded high single digit volume
growth in the third quarter. Acoustic insulation is performing well and we
continue to make inroads in the natural insulation category which will be
boosted further by our acquisition of 51% of Steico, expected to complete
early in 2024. District heating applications could see some project deferral
in the current interest rate environment. AlphaCore(®) is building an
early-stage specification bank and Optim-R(®) continues to advance,
particularly in the US.

 

Light, Air + Water sales in the first nine months were down 2% and by 3% in
the third quarter. Underlying sales were in line year to date and were down 1%
in the third quarter. Margin continues to progress reflecting a combination of
ongoing advancement in specification activity and category breadth.

 

Roofing + Waterproofing experienced a difficult trading environment in the
year to date although the integration of the businesses acquired over the last
12 months is progressing fully to plan. Divisional sales are tracking
comfortably in excess of €500m on an annualised basis. A number of
commercial initiatives are progressing with Insulation to build a Kingspan
integrated roofing solution. We plan to double sales in this division within
the next three years and have taken early steps in planning for multi-site US
capacity. In line with this long-term objective, on 10 October 2023, Kingspan
announced a cash offer to the shareholders in Nordic Waterproofing Holding AB
of SEK160 per share. The formal offer document will be issued by the end of
November with an anticipated acceptance period to February 2024.

 

Data + Flooring sales in the first nine months were up 8% and up by 3% in the
third quarter. Data centre activity continues to drive performance with an
extraordinary pipeline of activity as we look to the years ahead.

 

Net debt at the end of December 2023 is expected to reduce by a third versus
prior year to approximately €1.05bn (net debt/EBITDA 1.0x). This
incorporates a development spend (acquisitions and capex) of c. €450m in the
current year. The Group's working capital investment is now back to more
normal levels of efficiency than the elevated position in the prior year.

 

Looking Ahead

It is difficult to look too far ahead in this environment. Whilst end markets
have their obvious challenges the global backlog of orders has remained
reasonably stable over the last number of months. As highlighted at our recent
Capital Markets Day, the activity pipeline in data technology, EV automotive,
and refurbishment activity in general are all notable positives.

 

There is still some way to go in 2023 with the seasonally important fourth
quarter remaining and, accordingly, we expect to deliver a record full year
trading profit in the region of €875m.

 

For further information contact:

 

Gene Murtagh, Chief Executive Officer         Tel: +353 (0) 42 9698016

 

Geoff Doherty, Chief Financial Officer           Tel: +353 (0) 42
9698016

 

Pat Walsh, Murray Consultants                      Tel:
+353 (0) 87 2269345

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTDZLFBXFLZFBD