May 8, 2019 / 6:45 AM / 2 months ago

Building supplier SIG hit by Britain's construction market woes

(Reuters) - SIG Plc reported a fall in sales for the first four months of the year as it battled an increasingly challenging construction market in Britain, although the building materials supplier clung onto its annual profit expectations.

The company, which supplies insulation, energy management and roofing products, has also had to grapple with weakness across European construction markets from the end of last year, particularly in France and Germany, leading it to focus on restructuring.

The company said on Wednesday that trading conditions remained challenging and the outlook for many of its markets remained uncertain, especially in the UK.

Analysts on an average expect full year pretax profit to be 86 million pounds, according to Refinitiv Eikon data.

Total comparable sales fell 2.6 percent, with comparable sales in Britain and Ireland falling 9.2 percent.

“[The] Board remains confident... that the underlying profitability for the full year will be delivered in line with management expectations,” the company said.

SIG suffered a ransomware attack in France resulting in the business having no access to ordering and accounting systems for a short period in April. Core systems have now been restored, the company said.

SIG had already said that the UK’s construction market became increasingly challenging towards the end of 2018, with commercial construction demand dampened by macro-economic uncertainty, smaller house price rises and a slowdown in sales.

SIG said there would be job cuts, as planned, in the first half of 2019 to bring down operating costs and also pricing tweaks to shore up margins.

Reporting by Sangameswaran S in Bengaluru; editing by Gopakumar Warrier and Alexandra Hudson

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