6th Jul 2007 07:01
SIG PLC06 July 2007 TRADING STATEMENT 6 JULY 2007 SIG plc, the leading supplier of insulation, roofing, commercial interiors andspecialist construction products issues the following trading update for the sixmonths to 30 June 2007, in advance of the interim results which will beannounced on 13 September 2007. Trading performance has been very strong in the first half of 2007, with salesand operating profits substantially ahead of the first half of 2006. Total sales exceeded £1 billion for the first time in a six month period, andare expected to be more than £1070m (2006: £850m), representing growth in excessof £220m (25.9%) on a continuing basis*. Like for like sales** growth was inexcess of 10%. Underlying*** profit before tax for the six months to 30 June 2007 is expectedto be not less than £61.0m, an increase on a continuing basis of £13.6m (28.7%),on the £47.4m reported in the first half of 2006. Underlying operating profit is expected to exceed £69.0m an increase of £15.4m,28.7% on a continuing basis on the £53.6m reported in the first half of 2006. UK and Ireland (c.66% of Group sales) Total sales increased by c.18% over the first half of 2006, and like for likesales growth was in excess of 9%. All business streams have performed well, producing solid like for like salesgrowth over the corresponding prior year period. Underlying operating profits are substantially ahead of the £48.0m reported inthe first six months of 2006. Mainland Europe (c.34% of Group sales) Total sales increased by c.50% in Sterling, and by c.53% in local currency. Likefor like sales growth in local currency was in excess of 20%. All countries inwhich the Group has trading sites achieved substantial like for like growth. Underlying operating profits were significantly ahead of the £8.5m reported inthe first six months of 2006. The very strong performance in Mainland Europe reflects both a generalstrengthening of market demand for the Group's products in each country,especially in Germany and Poland, and also the strong progress made bybusinesses acquired by SIG in 2006, most of which did not impact on the Groupuntil the second half of 2006. Acquisitions The Group has completed 14 acquisitions, together adding 117 trading sites andannualised sales of c.£309m. Total consideration, including assumed debt andperformance-related contingent consideration amounts to £261m. Of the £309m annualised sales, approximately £274m is in Mainland Europe, and£35m in the UK and Ireland. The acquisitions are broadly spread across the Group's existing businessstreams, with the recent acquisition of Lariviere, the leading specialistroofing materials supplier in France (annual sales of c.£229m), creating a biasin the mix of acquired sales so far this year towards the roofing sector. Trading Sites The Group presently has 735 trading sites, a significant increase on the 618 asat 31 December 2006. Outlook During the first six months of 2007, the Group experienced reasonably goodoverall levels of construction activity in the UK and Ireland, and strongincreases in demand in Mainland Europe. Going forward, we do not anticipate any significant change in these conditions,other than in Ireland, where building activity is cooling. The second half of 2006 benefited from a sharp uplift in demand in Germany, andfrom the positive impact of acquisitions made in that period. In the light ofthis the year on year comparators for the second half of the year will be moredemanding than in the first half. The ongoing programme of investing in growth for the future, together with theperformance in the first six months of 2007, give the Board confidence thatfurther progress will be made. Definitions * references to 'continuing basis' refer to comparisons with 2006 excluding thecontribution from the USA business, which was sold in November 2006. ** 'like for like' is defined as the business excluding the impact ofacquisitions made since 1 January 2006. *** 'underlying' is before the amortisation of acquired intangibles and hedgeineffectiveness. Enquiries: David Williams, Chief Executive SIG plc 0114 285 6300Gareth Davies, Finance Director Gordon Simpson/Clare Strange Finsbury 020 7251 3801 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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