Kingspan has improved its growth with group sales up by 25 per cent over the first four months of the year compared with last year.
Analysts said they were raising their forecasts for the insulation company as it released an interim management statement, before its annual meeting in Dublin yesterday, which showed sales of €903.1 million for the four months ending April 30.
The company has spent €550 million on acquisitions and organic investment projects as it has expanded rapidly, which played a part in the revenue growth. It invested €570 million in acquisitions and capital expenditure and last year bought Joris Ide, the pan-European manufacturing business, and Vicwest, the Canadian materials business.
The company said that it has seen an easing in order placement in Britain before the EU referendum next month, but that its underlying business is performing strongly, with revenue up 8 per cent. It said that the project pipeline in Britain is encouragingly ahead of this time last year, adding: “In the US, the market is solid overall. In mainland Europe, the Netherlands and France have been particularly strong performers with Germany and eastern Europe very solid.”
The building materials group posted record revenues last year as strong growth in the UK, North America and the Middle East more than offset difficulties in some European markets and Australasia. Revenue for last year was up by 47 per cent to €2.77 billion and trading profit rose by 72 per cent to €256 million compared with the previous year.
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Analysts said yesterday the trading update showed that the company’s growth was set to continue apace.
“Kingspan has reported a strong start to the year,” analysts at Goodbody said. “Notwithstanding the tougher second half of the year comparatives, increasing headwind from currency and the challenge of recovering higher steel prices, such is the momentum in the underlying business we are upgrading our earnings before interest, tax and amortisation (ebita) forecasts by 4 per cent to €288 million.”
Davy’s analysts said that the trading update “underlines the fact that Kingspan’s earnings momentum remains strong and one of the dynamics that makes this one of the most attractive names in the building materials sector”.