DUBLIN (Reuters) - Irish building materials group Kingspan’s (KSP.I) reported a rise in profits on Monday but warned it had seen some recent evidence of a slowdown in the British commercial and industrial construction market, sending its share price lower.
Kingspan, a maker of insulation products in Britain where it generates over a quarter of its revenue, said in a trading statement sales rose 19 percent to 2.69 billion euros (£2.4 billion) in the first nine months of the year and it expected trading profits to rise 10 percent this year to 375 million euros.
However, it said it had also experienced “a sense of near-term indecision” in the placing of orders for insulated panels, while UK office work activity, affecting its access floor division which creates underfloor space to accommodate utility services, was softening as expected.
The shares were down 4 percent at 33.37 euros by 1037 GMT.
“It is unclear whether this (report of a slowdown) is a blip or represents a more profound shift, but it is clearly a concern,” analysts at Davy Stockbrokers said in a note.
Chief Executive Gene Murtagh had told Reuters in August that the only sign of an impact from Britain’s decision to leave the European Union at that point was a small deterioration in planned office projects in London.
“In general our end markets are relatively stable, notwithstanding some recent evidence of a slowdown in UK commercial and industrial activity,” Kingspan said in a trading update on Monday.
Britain’s economy looks set for a difficult 2018 as Brexit approaches with most economists polled by Reuters predicting slower growth next year.
Data on Friday showed construction fell 1.6 percent month-on-month in September, while confidence among firms in the sector dropped to the lowest level in nearly five years according to a survey earlier this month.
Reporting by Padraic HalpinEditing by Greg Mahlich