Insulation industry news from Global Insulation

Europe: Market research company Freedonia Group has forecast a 3% composite annual growth rate in European insulation demand over the five-year period between 2023 and 2028. This will result in a market value of €9.44bn, corresponding to volumes of 3.2Mt, in 2028. Drivers of the anticipated growth include tighter fire safety regulations and the cost effectiveness of mineral wool insulation.

World: Market research firm Future Market Insights (FMI) has forecast a composite annual growth rate of 6% in the global polyisocyanurate (PIR) insulation market up to 2033. This will result in 81% decade-on-decade growth to US$25.6bn in 2033. FMI noted technical developments affecting the use of customised PIR boards in the prefabricated construction as a main driver of the growth. Nationally, the market will have a CAGR of 8% in China, 7% in India, 6% in the UK, 5% in Canada and 4% in Germany.

FMI said “In the rapidly changing world of PIR insulation, innovation and sustainability have emerged as dynamic forces reshaping the industry’s trajectory. The market is going through a fundamental shift, moving beyond its traditional role of providing insulation and into uncharted territory where cutting-edge technologies are poised to redefine its boundaries.”

Germany: Sto has published its outlook for 2024, after recording ‘below target’ turnover in the first quarter of the year. The producer attributed this to adverse weather conditions in January 2024 and reduced working days in March 2024. For the full year, it now expect to record a turnover of €1.79bn and earnings before interest and taxes (EBIT) of €113 – 138m. It noted particular on-going ‘major challenges’ in its domestic German market.

Egypt: Smith Troy for Chemical Industries says that it expects to commission a new US$5m insulation line at Amreya, Alexandria, in June 2024. Business News Africa has reported that trial production will then run for two to three months. Smith Troy for Chemical Industries' CEO Walid Gamal el-Din said that the plant will export 80% of its production, which will contribute US$10m in sales in its first year of operations.

Serbia: Masterplast has concluded a deal to acquire the outstanding 49% stake in mineral wool insulation producer Masterwool MW-1. Masterwool MW-1 is currently building a new Euro20m mineral wool insulation plant in Vojvodina. The project is supported by a grant from Hungarian state-owned Hungarian Export Promotion Agency (HEPA).

Masterplast plans to commence a Euro50m growth phase in the near-term future. It expects its sales to drop in the first half of 2023 due to negative trends in new home construction. However, it expects recent new expanded polystyrene (EPS) and extruded polystyrene (XPS) insulation capacity to partly offset this.

Russia: The Ministry of Industry and Trade of the Russian government says that building materials are in high supply, but projected possible future shortages, beginning in 2024. Russian construction remains dependent on imports, and the government says that it will look to further develop the domestic production capacity of insulation and other materials from 2024.

France: Saint-Gobain’s sales were Euro25.5bn in the first half of 2022, up by 15% year-on-year from the same period in 2021. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 13% to Euro3.68bn. Sales rose by 15% in Northern Europe, by 14% in Southern Europe, Middle East and Africa, by 17% in the Americas and by 30% in Asia-Pacific. The producer ends the period with a net debt of Euro8.3bn, up by 9.2% from Euro7.6bn.

Chief executive officer (CEO) Benoit Bazin said, “Over the coming quarters, we are ready to adapt as needed to the consequences of rising interest rates and inflation along with the geopolitical and energy situation in Europe. Each country CEO has designed action plans, focusing especially on margins and cash flow. In this more uncertain environment, our target is to continue to outperform our markets and our deep transformation will enable us to demonstrate greater resilience. Over the past three years, our teams have successfully risen to the challenges of the coronavirus pandemic, supply chain disruptions and a strong inflationary environment. With portfolio rotation of almost Euro10bn in sales since the end of 2018, and with a local organisation keenly aware of immediate realities on the ground, Saint-Gobain has significantly increased its value creation. Against this backdrop, I am confident in the group’s 2022 outlook, which targets a further increase in operating income compared to 2021 at constant exchange rates.”

Switzerland: Holcim increased its consolidated sales by 17% year-on-year to US$15.3bn in the first half of 2022 from US$13.1bn in the first half of 2021. Its recurring earnings before interest and taxation (EBIT) were US$2.26bn, up by 9.6% from US$2.06bn. Solutions and products sales grew by 84% to US$2.72bn from US$1.48bn and accounted for 18% of group sales, compared to 8% of its full-year 2020 sales. The group’s operating profit rose by 15% to US$2.15bn from US$1.86bn, while its net debt rose by 7.5% to US$13.9bn from US$12.9bn.

Holcim called market conditions “volatile,” but forecast net sales growth of 10% year-on-year on in 2022, upgraded from 8%. The group forecast double-digit net sales growth in its Solutions and Products division to US$5.2bn for the year. It also expects to end the year with accelerated progress towards its 2025 sustainability targets, positive growth in its recurring EBIT and a free cash flow above US$3.12bn.

Chief executive officer Jan Jenisch said “Our record results, from net sales to recurring EBIT and earnings per share, are setting solid foundations to deliver our Strategy 2025 - Accelerating Green Growth. Our roofing and insulation businesses stood out as growth engines, on track to reach pro-forma net sales of US$3.64bn in 2022.”

Ireland: Kingspan says that it expects to record a profit of Euro415m in the first half of 2022, up by 26% year-on-year from Euro329m in the first half of 2021. The company noted that its global backlog of insulated panels orders fell by 2% year-on-year in volume on 31 May 2022, having previously been up by 19% year-on-year on 31 March 2022. It said that order volumes nonetheless remained above 2019 levels.

Denmark: Rockwool recorded consolidated sales of Euro924m in the first quarter of 2022, up by 38% year-on-year from first-quarter 2021 levels. The group’s earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 12% year-on-year to Euro155m.

CEO Jens Birgersson “High demand and sales price increases drove double-digit revenue growth across almost all business units. While not materially affecting sales performance at this point, the terrible war in Ukraine and the challenging geopolitical situation are contributing to an already stressed global economy. Even with the price increases, the soaring energy, material, and logistics costs diluted margins in the first quarter. This will necessitate further price increases across the businesses.” Birgersson added “We expect to restore margins in the coming quarters.”

In its Outlook 2022, Rockwool predicted full-year net sales growth of 20 – 25% in local currencies and Euro425m-worth of group investments during the year, excluding acquisitions. It says that its business in Russia continues operating on a stand-alone basis, in order to avoid nationalisation and loss of its intellectual property.