LONDON (Alliance News) - Kingspan Group PLC Tuesday said pretax profit was higher in the first half on the back of a rise in revenue, driven by a strong performance from its insulated panels and insulation boards business lines, and robust sales in its UK arm, which offset a mixed performance in other markets.
The Ireland-based building materials company said pretax profit rose to EUR60 million in the six months to June 30, a big jump on the EUR47.1 million posted a year earlier. That came on the back of a 4% rise in revenue in the period to EUR889.3 million from EUR851.5 million last year.
The group hiked its interim dividend for the first half by 14% to 6.25 cent from 5.5 cent last year.
Insulated panels sales were up 9% in the period, Kingspan said, with trading profit for the division rising 30%, while insulation boards sales were up 1% but trading profit rose 32%, with a particularly strong performance in the UK.
Environmental sales were flat and have stabilised, the group said, whilst adding it remains optimistic for the division on the back of a shift towards energy-efficient buildings. Access floor sales were down 11% in the first half, with its good performance in the UK was offset by weak US office activity.
Kingspan said UK revenue grew strongly in the first half for its insulated panels, insulation boards and access floors business, reflecting a recovery for general building activity in Britain. The UK contributes 38% of Kingspan's group revenue.
But as the UK recovered, the group said the trading environment in other markets remains mixed. For France and Benelux, Kingspan said macro-economic pressure continues to impact its performance. It said its performances in Germany, the Gulf region and North America were all stable, but said the recent political instability in Turkey had impacted its results there.
"Kingspan has delivered strong growth in profitability, notwithstanding a tougher EU construction sector in the second quarter, and a global economic recovery that remains weak. Our order book carried good momentum into the second half of the year, driven by continued growth in the demand for low energy buildings," said Kingspan Chief Executive Gene Murtagh.
Kingspan shares were up 1.9% to 13.83 pence Tuesday morning.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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