Insulation industry news from Global Insulation
US: Installed Building Products’ (IBP) net revenue rose by 30% year-on-year to US$863m in 2016 from US$663m in 2015. Its net income rose by 45% to US$38.4m from US$26.5m. The company has attributed the growth to its presence in strong housing markets.
"IBP achieved many milestones during 2016, including record revenues and earnings, the addition of nearly US$100m in acquired revenues and the announcement of the acquisition of Alpha Insulation and Waterproofing, the largest acquisition we have made to date," said Jeff Edwards, chairman and chief executive officer of IBP.
Finland: Paroc has described 2016 as ‘fairly challenging’ as its net sales fell slightly to Euro376m and its earning before interest, taxation, depreciation and amortisation (EBITDA) rose by 4% to Euro76.5m in 2016 from Euro73.3m in 2015. Despite reporting an improvement in construction activity in the second half of the year, sales fell in Russia. The insulation producer solid its Paroc Panel System (PPS) business to Kingspan Group in December 2016 and it announced plans to shut its Oulu stone wool plant in January 2017.
Denmark: Bjørn Høi Jensen, the chairman of Rockwool, has announced that he will not be standing for re-election at the company’s annual general meeting in April 2017. He said that as he had met his goals to review the management group, start a new growth plan and introduce an ‘extensive’ improvement in results that he was standing down earlier than planned. He originally became chairman in 2014.
Rockwool’s external net sales for its insulation division dropped by 2% to Euro1.63bn in 2016 from Euro1.66bn in 2015. In local currencies the company calculated a slight rise of 0.7% for its net sales. However, its overall profit nearly doubled to Euro166m from Euro90m and its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 21% to Euro389m from Euro322m. It blamed the poor sales on the industrial and technical insulation industries and the slow development of construction in Russia in both new build and renovation. In a statement Jensen described 2016 as a year ‘marked by tough conditions.’
The insulation and building materials producer also announced that it was planning to build three new production plants including a stone wool factory in Mississippi, US. Land acquisitions for the projects are expected to be completed in 2017.
New Zealand: Fletcher Materials has said that it has been able to strengthen its insulation business in both New Zealand and Australia due to improvements in service and relative cost position in the six months to 31 December 2016, following site closures at its Fletcher Insulation business. Overall, operating earnings before significant items for its Building Materials lines, including plasterboard and insulation products, rose by 10% year-on-year to US$38m from US$34.4m.
Ireland: Kingspan’s sales revenue has risen by 12% year-on-year to Euro3.11bn in 2016 from Euro2.77bn in 2015. Its profit after tax rose by 34% to Euro256m from Euro191m. It attributed the sales growth to ‘strong’ performance in the UK and a recovery in Western Europe. However it noted that its US market was subdued in the second half of the year.
“2016 was another record year for Kingspan. Through our organic initiatives and acquisition strategy we are developing a truly global business well placed to capitalise on the transition towards a lower energy future. We are encouraged about the outlook for the first half of 2017, with the current order book solidly ahead of the same point last year,” said Gene Murtagh, chief executive of Kingspan.
US: Owens Corning’s net sales of insulation have fallen by 6% year-on-year to US$1.75bn in 2016 from US$1.85bn in the same period in 2015. Earnings before interest and taxation (EBIT) fell by 21% to US$126m from US$160m. The company previously said that it expected negative revenue growth in 2016 due to a contractual dispute with a large residential customer that began early in the second quarter of 2016. In the second half of 2016 it reported stable pricing and market recovery with its residential fibreglass insulation business. Overall, Owens Corning’s sales and EBIT rose across all business lines.
Germany: Steico, a manufacturer of thermal insulation made from wood, has reported that its sales rose by 10.6% year-on-year to Euro209m in 2016 from Euro189m in 2015. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 34.4% to Euro33.2m from Euro24.7m. The company said that ‘very pleasing growth’ was noted for its wood-fibre insulation materials in 2016 but it didn’t specific any volumes. It did mention ‘continued price pressure’ in the period as well as increased exports.
UK: SIG’s sales rose by 0.3% on a like-for-like basis, the building materials distributor has said in a trading statement. Sales rose by 11% year-on-year to Euro3.4bn in 2016 but they were mainly driven by foreign exchange rates and acquisitions. In the UK & Ireland like-for-like sales increased by 1.1%, with SIG Distribution up by 1.2% and SIG Exteriors down by 1.5%. In mainland Europe life-for-like sales declined by 0.5%, with France and Germany down by 2.0% and 1.3% respectively.
"2016 was a disappointing year for SIG. While the competitive environment, particularly in the UK, was challenging, our transformational change programme, although taking the group in the right strategic direction, distracted us somewhat from our customers,” said chief executive Mel Ewell. He added that the company is planning to focus on customers, place added emphasis on sales growth and reduce its leverage in 2017.
SIG will announce its full year results for 2016 on 14 March 2017.
Denmark: Sales from Rockwool’s insulation business have fallen slightly by 2% year-on-year to Euro1.22bn in the first nine months of 2016 from Euro1.24bn in the same period in 2015. However, the group reported this as a 1.2% rise in local currencies. Earnings before interest and taxation (EBIT) rose by 61% to Euro114m from Euro71m. By region it said that sales performed well in North America, showed signs of improvement in Western Europe but continued to decline in Russia.
Ireland: Kingspan’s sales have risen by 13% year-on-year to Euro2.27bn for the first nine months of 2016 from Euro2bn in the same period in 2015. Sales by its insulated panels division rose by 17% driven by good markets in the UK, France and Benelux, although slowdowns were reported in Germany and the US. Sales by its insulation board division rose by 6% with positive performance noted in the UK, Ireland, Scandinavia and the US. The insulation producer noted in its interim trading report that the weakening Pound Sterling against the Euro was negatively impacting its Sterling denominated earnings.