Insulation industry news from Global Insulation

Ireland/UK: Knauf Insulation has launched a new packaging including new designs across the whole range, an upgrade to its compression technology and more environmentally-friendly packaging.

The new packaging designs feature bigger and clearer product names. Products are colour-coded into thermal conductivity groups consistent across the whole glass mineral wool range, and essential features such as the Euroclass A1 reaction to fire classification and Ecose Technology, Knauf Insulation’s unique bio-based binder, are more easily identifiable. The Earthwool brand has been phased out to simplify the branding structure, and a new brand, Rocksilk, has been introduced for its rock mineral wool product range. The insulation producer says that a further upgrade of the compression technology on the glass mineral wool range enables, on average, 15% more insulation per roll and 25% more packs on each pallet for slabs.

“We’ve listened to our customers, but we have also been proactive, trying to pre-empt future needs,” said Vanessa Rae, Marketing Director at Knauf Insulation Northern Europe. “We know how important it is to choose the right product for the application quickly, and move and store it efficiently, whether in-branch or on-site. We also know that sustainability matters more than ever, so we’ve taken these steps to reduce our products’ carbon footprint further so customers can rely on us to help them tick the green boxes for their projects.”

Ireland: Kingspan has forecast first-half consolidated net sales growth of 40% year-on-year in 2021 to Euro2.90bn from Euro2.07bn in the first half of 2020. It predicted a rise in operating profit of 57% to Euro315m from Euro200m. The company concluded its acquisition of Denmark-based pipe insulation producer Logstor International Holding on 22 June 2021 for Euro253m.

Ireland: Kingspan’s consolidated net sales increased by 24% year-on-year in the first quarter of 2021 to Euro1.28bn. Insulated panels sales grew by 25% having started the year with a strong order backlog and insulation boards grew 12%. Communications company Edison Group said that growth was most pronounced in Germany, France and Benelux and Latin America, with a strong order intake in North America and the UK. Net debt at 31 March 2021 was Euro352m.

The company noted increasing inflationary pressure and challenges regarding availability despite strong demand and a strong backlog. As such, it has given no guidance for the year.

Kingspan highlighted its inaugural Planet Passionate sustainability report. The report details the company’s achievements in the first year of its 2019 10-year sustainability strategy. In 2020, the producer achieved net-zero energy and cut CO2 emissions by 5% year-on-year. It issued a Euro750m green private placement in September 2020. The company called the major achievements the ‘first leg’ of its decarbonisation journey. In its latest report, it set the target of net-zero CO2 emissions by 2030. Additionally, it is aiming to halve CO2 intensity over the same period. Altogether, Planet Passionate covers 12 sustainability targets across the key areas of energy, circularity, CO2 and water.

Chief executive officer Gene Murtagh said “Our Planet Passionate targets demand radical thinking and action. Our aim is to get as close to zero emissions in our manufacturing as technically possible by transforming our processes. Industry has a vital role to play in addressing the threat of climate change.” He added that the group target of 50% primary raw materials CO2 intensity reduction “will also lower the embodied carbon in our products, and consequently the whole life carbon of buildings.”

Ireland: Kingspan recorded full-year consolidated sales of Euro4.58bn in 2020, down by 2% year-on-year from Euro4.66bn in 2019. Profit for the year from continuing operations was Euro385m, up by 2% from Euro378bn. Earnings before finance costs, income taxes, depreciation, amortisation (EBITDA) increased by 3% to Euro597m from Euro580m. Insulation boards sales fell by 10% to Euro787m from Euro877m. Kingspan’s trading profit from insulation boards fell by 6% to Euro117m from Euro110m.

The group said, “2020 was a tumultuous year for Kingspan, as it was for many. After a relatively strong start, April and May saw a deep reduction in activity in many markets, followed by a rebound towards mid-year and ultimately a strong finish in the fourth quarter.” It added, “Globally, governments reacted in varying ways to the crisis which resulted in an economic experience which was equally variable. All markets suffered interruption to some degree, although in our case it was particularly acute in the UK, Spain, Canada and Ireland. Most other markets recovered to, and in some cases exceeded, the performance of 2019.”

In late 2020, the company made changes following the Grenfell Tower fire inquiry’s ‘highlighting’ of ‘historical behaviours’ affecting the company’s role as indirect supplier of some of the building’s insulation. Chief Executive Officer Gene Murtagh said, “The unacceptable conduct and historical process shortcomings, involving a small number of employees in our UK insulation boards business, do not reflect the high standards of integrity and safety that are core Kingspan values, deeply held by our people. We have already implemented several important changes that demonstrate our commitment to product compliance and good governance. Our aims are clear: to reassure that safety takes precedence over all other considerations and to ensure this can never happen again.” The changes include the launch of a new code of conduct, new testing protocols and the publication of all test reports.

Ireland/US: Ireland-based Kingspan has pulled out of bidding for Firestone Building Products. Bloomberg News has reported that both Kingspan and Standard Industries have dropped out of the auction. The roofing and building materials company was expected to reach a value of Euro2bn. The deadline for submitting offers is 28 December 2020.

Earlier in December 2020, Kingspan’s chief executive officer (CEO) Gene Murtagh apologised for ‘process shortcomings’ that have been highlighted by the ongoing Grenfell Tower Inquiry in the UK.

UK/Ireland: Kingspan UK head of insulation boards Peter Wilson will retire from the company at the end of 2020. Wilson will also step down from his position on the producer’s board of directors.

Chief executive officer (CEO) Gene Murtagh has also apologised for ‘process shortcomings’ that have been highlighted by the ongoing Grenfell Tower Inquiry. The Irish Times newspaper reports that the company used flawed safety tests to market its Kooltherm K15 insulation product, some of which was used on the building. Murtagh used his Christmas 2020 address to staff to pledge trust-rebuilding action. He said that the company will treat the issues raised in the inquiry with the ‘utmost seriousness.’

In other personnel changes, Alan Lawlor has been appointed Divisional Managing Director of Kingspan's Insulation Boards Division with responsibility for its global activities. He is currently chief financial officer of Kingspan's Insulation Boards Division and managing director of Kingspan Insulation, Southern Europe.

Jim Carolan has been appointed as Group Head of Compliance & Certification with immediate effect, reporting to the Group chief executive officer (CEO). The group said that in this newly created role he will be responsible for ensuring a rigorous approach to certification, testing and product compliance across all Group divisions. Carolan's prior role was as Operations Director in Kingspan's Insulated Panel's Division.

Ireland/UK: Mannok says that it has undertaken extensive preparatory measures to help its operations transition smoothly when the Brexit transition period ends on 31 December 2020. While keeping operations unchanged, the group has formed new legal entities such as Mannok GB, which will deal with UK customers. The group acknowledged that prices would depend on the future tariff arrangement between the UK and the EU, but would remain in line with market pricing. It added that the same effects would impacts competitors, who import significant amounts of raw materials from Europe.

The group said that it has been working closely with suppliers for over 18 months to ensure the security of its supply chains. It has capacity at its sites to store enough raw materials for polyisocyanurate (PIR) insulation for a ‘number of weeks’’ of production.

Chief financial officer Dara O’Reilly said, “A key priority for us in all of this was to ensure that the service we can provide to our customers in a post-Brexit environment is as seamless as possible. We’ve made the changes to our structures; we’ve made the changes to how we operate and as a result of that, regardless of the outcome of the Brexit negotiations, we’re ready.”

Ireland: Kingspan has reported a sales fall of 5% year-on-year in its 2020 nine-month trading update, to Euro3.27bn from Euro3.44bn in the first nine months of 2019. Its sales of insulation boards fell by 14% and by 5% year-on-year in the third quarter of 2020.

The group said that insulation board sales “performed well” in Ireland, the UK and parts of Continental Europe in the third quarter of 2020, while volumes “improved, with raw material-related price deflation in the earlier part of the period partially offsetting this” in total sales. The Asia Pacific region “consolidated the progress seen in the first half,” while activity in the US was “positive through the third quarter.” Only the Middle East proved “a more challenging environment.”

The company said, “Overall, our end markets are in reasonable shape bearing in mind the uncertain and evolving backdrop. In this environment it is difficult to see too far ahead and trading patterns can evolve quickly. Our raw material costs are on the rise at present and, with the customary lag anticipated, a challenging recovery effort is underway. Trading in the fourth quarter to date has been strong, helped to an extent by accelerated demand in the expectation of inflation-led price increases in the coming months. Whilst conscious that much of the seasonally variable fourth quarter is still at play, in what is an untypical year, we expect to deliver a full year trading profit marginally ahead of 2019.”

Ireland: Kingspan has written to the Building Research Establishment (BRE) to withdraw fire test reports on its rigid thermoset phenolic insulation Kooltherm K15. The Irish Times newspaper has reported that, speaking at the inquiry into the Grenfell tower fire in London, a representative of the company admitted that the fire test reports on Kooltherm K15 may not reflect the actual product. This was due to possible compositional changes arising from “process shortcomings” that “fell short of the high standards which Kingspan sets itself." In 2007 it failed a fire test in which it was reportedly tested with a cladding system that also failed subsequent testing with another company’s insulation.

The Grenfell inquiry has asked Kingspan why it had not previously withdrawn the Kooltherm K15 fire test reports with the BRE. A distributor supplied the insulation to contractors for use in the refurbishment of Grenfell in 2012 – 2016.

The majority of the insulation purchased for use in a refurbishment of Grenfell Tower prior to the fire in June 2017 was Celotex’s RS5000 polyisocyanurate foam (PIR) insulation board. However, Kingspan confirmed in July 2017 that a small amount of its Kooltherm K15 product had also been used without its knowledge and that it had no involvement in the design or specification of the refurbishment.

Ireland: Kingspan Group’s sales fell by 3% year-on-year to Euro1.03bn in the first quarter of 2020. It said that the coronavirus-related lockdowns did not ‘significantly’ impact activity for most of the reporting period although the, “landscape changed markedly from the middle of March onward.” The UK and Germany reported improvements, the Americas did well and both Australasia and the Middle East saw rising orders. Insulation board sales were strongly impacted by falling prices. Looking forward the group said that its global sales fell by nearly 35% year-on-year as various construction markets were closed down.