Kingspan's half yearly revenues boosted by acquisitions

Monday 19 August 2013 14.27
Kingspan reports 13% rise in half yearly revenues
Kingspan reports 13% rise in half yearly revenues

Shares in building materials group Kingspan rose sharply in Dublin today after it said that sales of some of its products in Ireland are improving.

Half year results filed by Kingspan, which specialises in environmentally friendly and low energy products, show a 19% growth in Irish sales revenue in its insulated panels division, while revenue in Ireland from its insulation boards division rose by 7%.

It said that general construction and refurbishment activity in Ireland has improved ''somewhat'', with pricing being the key challenge as the market ''embarks on its long route to recovery''.

Overall Kingspan reported 13% revenue growth to €858.4m for the six months to the end of June, while pre-tax profits rose to €47m from €44.5m the same time last year.

The Co Cavan-based company said it benefited from two acquisitions completed late last year - Rigidal Industries and ThyssenKrupp Construction - without which its revenue would have fallen over the first six months of this year compared to 2012.

The company said its interim dividend per share rose by 10% to 5.5 cent from 5 cent the same time last year.

''Kingspan delivered a positive performance in the first half against a backdrop of weak European economic conditions and a tough winter across many regions,'' commented the company's chief executive Gene Murtagh.

But he said the company's strategy of positioning it at the hub of conversion to lower energy buildings continues to enable it to build the business globally, despite the external conditions.

Kingspan shares moved higher in Dublin trading today.

Breaking down its divisions, Kingspan said that turnover at its insulated panels unit rose by 34% to €482.5m, while operating profit grew by 24% to €33.5m after a strong trading performance.

Turnover at its insulation boards division slipped by 3% to €225.7m while trading profits fell by 13% to €13.5m with weak market activity in the first quarter. Kingspan said that its trading margin was down on last year, mainly due to lower incentive driven external wall insulation in the UK and Germany.

Its access flooring division saw turnover inch 1% higher to €78.9m for the six month period, while trading profits fell by 9% to €8.1m due to a more competitive market in North America and Australia.

Revenue at Kingspan's environmental division fell by 17% to €71.3m while trading profits for the half year dropped 33% to €0.8m.

Looking ahead, Kingspan said that while sentiment internationally seems to have improved recently, broader economic activity is unlikely to provide much of a ''springboard for growth'' in the near future.

''This aside, Kingspan's commitment to an expanding geographic platform and its recent and new product introductions, combined with a robust order book and pipeline, should deliver an improved year-on-year result in the second half of 2013, the company said in its results statement today.