Kingspan Group PLC Trading Statement (4456F)
November 07 2022 - 2:00AM
UK Regulatory
TIDMKGP
RNS Number : 4456F
Kingspan Group PLC
07 November 2022
Kingspan Group Plc
Trading Update
07 November 2022
Kingspan Group plc, the global leader in high performance
insulation and building envelope solutions, today issues a Trading
Update for the period to 30 September 2022.
Sales in the nine month period to 30 September were EUR6.25bn,
up 33% on the same period in the prior year, with sales growth of
17% in the third quarter. Underlying sales (pre currency and
acquisitions) were up 20% in the year to date and by 9% in the
third quarter.
Insulated Panels sales increased by 29% in the first nine months
and by 13% in the third quarter. Underlying sales were up 23% year
to date and up 7% in the third quarter. Global sales volumes in the
third quarter were expectedly sluggish reflecting the slowdown in
order placement flagged mid-year. Undoubtedly, a factor has been
expectations around raw material pricing with some pick up in order
placement post the summer period. We have been carrying higher
levels of inventory than normal for much of the year and, as
certain inputs have seen deflation more recently, this has had a
short-term impact on margins as these materials sell through. In
general, activity in the Americas has held up reasonably well, as
has Germany and the UK with softer activity elsewhere in Europe. We
continue to advance our innovation agenda notably QuadCore(TM) LEC
Panel comprising an estimated 45% of recycled materials and with
40% less embodied carbon.
Insulation sales in the first nine months were up 48% and up 20%
in the third quarter. Underlying sales were up 12% year to date and
by 8% in the third quarter. The sales growth experienced in the
third quarter was price led reflecting input inflation with rigid
board volumes soft overall with decreased residential activity a
factor. Technical insulation, in particular district heating
applications, continued to experience the momentum seen in the
first half. The Troldtekt business acquired earlier in the year is
integrating well and significant progress has also been made in the
natural insulation category with bio-based materials for ultra-low
embodied carbon insulation. Encouragingly, AlphaCore (R) is
building a specification bank and is likely to advance further in
the years ahead.
Light + Air sales in the first nine months were up 33% and by
26% in the third quarter. Underlying sales were up 17% year to date
and by 18% in the third quarter. Most end markets performed well
reflecting the positive orderbook year on year and the division is
on track to record margin progression for the year.
Roofing + Waterproofing had a milestone third quarter with the
completion of the acquisition of Ondura Group in September. The
division now has annualised revenues of approximately EUR500m
including the acquisition of Derbigum in June 2022. Furthermore, in
August 2022 the Group acquired a 24% strategic minority stake in
Nordic Waterproofing. A significant element of the new division is
European and our ambition, and the opportunity, is global.
Data + Flooring sales in the first nine months were up 32% and
up 33% in the third quarter. Underlying sales were up by 24% in the
first nine months and were up 25% in the third quarter. Datacentre
activity continues to drive performance and the pipeline of
activity is encouraging as we head towards 2023.
Water + Energy sales in the first nine months increased by 12%
and up 5% in the third quarter. Underlying sales were up 6% year to
date and were up 1% in the third quarter.
Net debt at the end of December 2022 is expected to be in the
region of EUR1.5bn (net debt/EBITDA 1.5x) reflecting a 2022
development spend in excess of EUR1.2bn (acquisitions approximately
EUR1.0bn and organic investment approximately EUR0.2bn). Year end
liquidity, representing cash balances and undrawn committed
facilities, is expected to exceed EUR1.5bn with the Group's average
cost of debt standing at 1.85%.
Looking ahead
A feature of the current environment is the lack of visibility
beyond the next short period of months. Sentiment is cautious for
the most part although not uniformly so. The sharp increases we
have seen in raw material prices over the last eighteen months
appear to have peaked, at least for now. Certain key inputs are
likely to reduce in price in the fourth quarter. The global backlog
of orders has been reasonably stable over the past three months.
The activity pipeline in data, technology, EV automotive and
district heating applications are all notable positives.
There is still some way to go in 2022 with the seasonally
important fourth quarter remaining and, accordingly, we expect to
deliver a full year trading profit in the region of EUR830m,
significantly ahead of the EUR755m recorded in 2021.
For further information contact:
Gene Murtagh, Chief Executive Officer Tel: +353 (0) 42 9698000
Geoff Doherty, Chief Financial Officer Tel: +353 (0) 42 9698000
Pat Walsh, Murray Consultants Tel: +353 (0) 1 4980300
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