Sheffield’s SIG reports sales growth; shares rise

Shares of Sheffield-based international building materials supplier SIG plc rose about 6% on Friday after it issued a trading update for the third quarter of its current financial year saying it expects full year underlying operating profit to be ahead of current market forecasts. 

“Further to the update provided at the time of the group’s interim results, the board is pleased to confirm that the solid trading performance seen in July and August continued through September,” said SIG.

“As a result, like for like sales growth in Q3 was 17% vs the prior year. This follows the 33% reported in H1, a number distorted by the material Covid impact in 2020.

“Against pre-Covid 2019 comparatives, Q3 growth was 9%, up from the 1% growth seen in H1.

“UK Distribution performance provided the principal driver for the acceleration in growth during Q3, with the business moving, as expected, back to growth against 2019 monthly comparators, as the strategic and operational changes made since July 2020 continue to drive the return towards its previous market position and performance.

“Our France and UK Exteriors businesses, and our Poland business, continue to perform very strongly.

“Ireland was, as anticipated, a further driver for the Q3 acceleration, rebounding after the H1 impact of local Covid-related restrictions.

“As previously reported, inflation is also adding to the top line in all geographies, with the group continuing to pass through cost increases.

“Profitability continued to improve in the quarter compared to the first half, despite the typical modest seasonal dip in sales volumes in August.”

In its outlook, SIG said: “Whilst supply issues persist across many product groups, order books continue to build and the outlook for materials shortages has become clearer.

“We are mindful of the potential impact of these shortages should the situation persist for an extended period, but remain highly confident in the effectiveness of our supply chain management and commercial agility.

“As a result of the continued strong sales momentum and operating performance, we are now more confident in our near term outlook and expect full year underlying operating profit to be ahead of current market forecasts. “