SIG says sales down

LONDON (Reuters) - Building materials maker SIG (SHI.L) on Friday reported a 10 percent drop in its first-half sales, blaming "exceptionally challenging" trading conditions.

SIG, which sells insulation and other construction materials across the UK and mainland Europe, said it had sales of 1.345 billion pounds in the six months to June 30, down from 1.494 billion pounds in the same period last year.

The company said the decline reflected lower orders due to a combination of deteriorating economic conditions and exceptionally cold weather during the first quarter.

Sheffield-based SIG said it had focussed on cash generation and cost control during the first half, reducing its net debt by 74.1 million pounds, and cutting expenses by 39 million pounds.

SIG warned last month that its 2009 underlying pretax profit would be at the bottom of the range of analysts' forecasts at the time.

The company said on Friday that there had been no change in the trading environment since its most recent trading statement on June 18.

SIG shares closed at 88 pence on Thursday, valuing the company at about 520 million pounds.

(Reporting by Myles Neligan, editing by Will Waterman)