REG - SIG PLC - Trading Update

SIGAnnouncement

04/05/2023 07:00

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RNS Number : 3411Y  SIG PLC  04 May 2023

4 May 2023

SIG plc Trading Update

Trading in line with expectations

 

SIG plc ("SIG", or "the Group"), a leading supplier of specialist insulation
and building products across Europe, today issues a trading update for 1
January to 30 April 2023 ("the period"), in advance of its Annual General
Meeting, which is being held later this morning.

 

Key points

·   Trading in the period in line with management expectations

·   Group like-for-like(1) ("LFL") sales growth of 1%, with revenues of
£924m

·   Results reflect challenging market conditions, more than offset by
input price inflation

·   Solid sales growth from France, Germany, and UK Interiors

·   Group's 2023 full year outlook unchanged

 

Trading Summary

Group LFL sales were up 1% in the period compared to prior year.  Reported
Group revenues were 7% higher in the period, including c.3% from acquisitions,
together with c.3% in aggregate from movements on working days and exchange
rates.  Market conditions remain challenging and Group volumes were lower, as
expected.  This was more than offset by a continued positive tailwind from
input price inflation.

 

The overall impact of inflation is estimated to have added c.11% to Group
growth over the period.  As expected, price inflation has moderated since H2
2022, despite further price increases in early 2023, as we annualise some of
the significant prior year price increases.

 

 1 January to 30 April 2023 Sales      %                    £'m

                                       LFL growth vs 2022
 UK Interiors                          5%                   249
 UK Exteriors                          (3)%                 142
 UK                                    2%                   391

 France Interiors                      3%                   76
 France Exteriors                      7%                   165
 Germany                               2%                   153
 Poland                                (13)%                68
 Benelux                               11%                  40
 Ireland                               (17)%                31
 EU                                    1%                   533

 Group                                 1%                   924

 

Our French, German and UK Interiors businesses continued to deliver solid
sales growth.  The UK Exteriors business saw some further softening in the
RMI end-market, continuing the trend seen in the latter part of 2022.
 Volumes and market conditions have been notably weaker in Poland and Ireland
in recent weeks, with the former also coming up against especially strong
prior year comparators.

 

The Group has continued to make progress on its strategic initiatives, while
managing challenging market conditions. During 2023 our operational priorities
include active product category management to develop product mix and margin
over time and leveraging prior year investment in new branches and strategic
relocations.

 

Outlook

Our outlook for FY23 remains unchanged.  As set out in our FY22 results on 8
March 2023, we expect weaker and uncertain demand conditions to prevail during
2023, offset by a continued tailwind from input price inflation, albeit the
latter will continue to moderate further this year.

 

We continue to focus on operational agility, productivity, and discipline in
2023.  We remain confident in our ability to harness the strong momentum in
the business and further improve our market positions, and to continue to
improve our profitability when market conditions recover.

 

As a European market leader in the supply of specialist insulation, and with
80% of the Group's sales covering insulation and the wider building envelope,
we are well-positioned to benefit from long-term structural growth drivers,
notably sustainable construction and decarbonisation of buildings.
 Notwithstanding short-term market weakness, we expect to benefit from
long-term growth in demand for the Group's products across our pan-European
network of branches.

 

Following the arrival of Gavin Slark in February 2023 as new CEO, the Group
continues to review the strategic and operational priorities in each of our
operating companies and the roadmap towards our medium term 5% operating
margin target.

 

H1 Results date

We will publish our H1 2023 results on 8 August 2023 and will hold a
presentation and conference call for analysts and investors at 10.00am (GMT)
on that date.

 

1.      Like-for-like is defined as sales per working day in constant
currency, excluding completed acquisitions and disposals

 

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

 

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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