13th Jan 2015 07:54
LONDON (Alliance News) - Building products group SIG PLC on Tuesday said it expects an improvement in underlying pretax profit and revenue for 2014, despite being held back by currency movements.
The FTSE 250-listed company said it expects its underlying pretax profit for the year to December 31 to be marginally ahead of what it cited as the Bloomberg market consensus of GBP96.5 million. That would be an increase on the GBP90 million posted for the year earlier.
The company said it expects revenue from continuing operations for the year to be GBP2.6 billion, up 2.5% year-on-year despite adverse foreign currency translation effects which cut sales by 3.1%.
Like-for-like sales for the year were up 3.7%, with a strong performance in the UK and Ireland where sales rose 9.1%. Mainland Europe trading deteriorated over the year due to weakening macroeconomic conditions, pushing like-for-like sales down 1%.
The group expects to achieve cost savings of GBP10 million for 2014, well ahead of its original target of GBP1 million to GBP5 million. The savings were mainly achieved through changes to its procurement practices and resulted in a 50 basis points improvement in its gross margin, it said.
SIG expects its cumulative net savings for 2015 to be around GBP20 million and reiterated its 2016 target of GBP30 million.
It expects trading conditions to be variable across its regional operations in 2015, with strong growth in the UK and Ireland but continued uncertainty in Europe. It expects to make further progress in 2015, albeit with its results weighted to the second half.
SIG will post its full 2014 results on March 12.
By Sam Unsted; [email protected]; @SamUAtAlliance
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