SIG, a leading distributor of building products in the UK and several European markets, has released a trading update this morning covering the twelve months to the end of December. The company reported that revenue for the period amounted to £2,720 billion (+4% YoY), benefitting from foreign exchange tailwinds. <p>
Group LfL sales increased by 2.5% in H2 2013 (H1 2013: -3.5%) that left FY 2014 LfL sales lower by c.5% (Europe -1.5%, UK +1%). In a similar pattern to that experienced by other builders merchants, the negative weather impact experienced during H1 2013 reversed in H2 providing additional sales while the underlying recovering in the UK residential market also helped boost trading levels. <P>
SIG has also been a beneficiary of cost savings in recent reporting periods and management continue to identify additional areas to reduce cost levels. In the group’s H1 results, management had identified £3.9 million of savings (exceptional charge: £5.6 million) and subsequently identified additional savings, increasing the total to £9 million (40% achieved in 2013), bringing the exceptional cost to £19 million, to be recorded in the 2013 accounts. <p>
In terms of outlook, management expect construction activity in the UK residential market to remain “buoyant” while non-residential activity levels will remain “subdued”. Across Europe, markets will remain “variable”. Against this backdrop, management expect that further progress will be achieved in 2014.
Merrion Stockbrokers Limited (registration no. 307878)
is a limited liability company whose registered office is at
Block C, The Sweepstakes Centre, Ballsbridge, Dublin 4, Ireland.