Building products firm SIG says it market could be slower this year but has told investors profits are expected to be towards the top end of expectations.
The Sheffield-based supplier, which has operations in Europe, said operating profits for 2023 were likely to be between £50m and £55m, significantly down from the £80.2m it booked the year before. SIG has been carrying out a turnaround plan in recent years and in its latest update, it said restructuring activity would provide cost savings of £10m - the majority of which will come in 2024.
The firm said demand softened in the second half of the year as like-for-like growth rates slowed down across most of its markets. Bosses pointed to a "robust" performance in its UK interiors business, with demand tailing off in France and some recovery in Germany, which was described as a challenging market.
Read more: North East confectioner Sweetdreams snapped up by SugaRich in undisclosed deal
Read more: Housebuilder MJ Gleeson sounds note of optimism for housing market
In Poland, growth was said to have rebounded in the second half, and in the Benelux countries new management was installed in a bid to improve performance. In Ireland, like-for-like sales growth fell 15% over the full year.
Gavin Slark, CEO, said: "Despite challenging market conditions across the European building and construction sector, the group has delivered a robust trading performance, through a strong focus on our customers and the great efforts of all our people. In my first year as CEO, I have been impressed by the opportunities that exist within SIG's portfolio for strengthening our operating performance and accelerating our specialist businesses, and for delivering more profitable growth over the medium term.
"Whilst we expect continued softness in market conditions in 2024, we are confident in our ability to manage through this current phase of the cycle and to continue to strengthen our operations, ready to take advantage of the significant long-term opportunities for the group as markets recover."
