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European sales boost SIG

8 Jul 11 Building materials company SIG reports a 10% rise in like-for-like revenues in the first six months of the year.

Even including the workwear and scaffolding business that were sold during the first half, total revenues were up 9%.

Since the company’s last trading statement in May, business has continued in line with expectations and the board expects the group's underlying profit before tax for the first half of 2011 to be approximately £34m, nearly double the H1 2010 figure of £18.5m. 

“This performance reflects the operational gearing benefit of strong sales growth at stable gross margins, delivered through a leaner cost base as a result of management initiatives in recent years,” the company said.

SIG supplies insulation materials, exteriors, interiors and specialist construction products.

Sales in mainland Europe (which accounts for 54% of business) were up 15%, with France, Germany and Poland/Central Europe cited as good growth markets. Benelux remained challenging.

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In the UK and Ireland (46% of group sales), continuing sales were up nearly 4%.

“Growth in residential construction maintained the mildly positive trend experienced during 2010, although some weakness in the private repair, maintenance and improvement sector (RMI) and public sector housing was experienced towards the end of the period,” the company said.

SIG said that non-residential construction activity levels now appear to have flattened out, with modest recovery in the southeast offset by continuing slight decline in other parts of the UK.

The company said that it had not yet experienced any significant impact from the expected reduction in public sector non-residential construction resulting from government austerity measures.

Joining the board of directors in a non-executive capacity is Amey chief executive Mel Ewell.

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