Insulation industry news from Global Insulation

Ireland: Kingspan has announced that its profit rose by 24% year-on-year to Euro69m in the first half of 2014 as revenues rose by 4% to Euro890m. The company said that the improvement came due to rising sales of its key products, despite conditions remaining tough in the European construction sector.

"Kingspan has delivered strong growth in profitability, notwithstanding a tougher EU construction sector in the second quarter and a global economic recovery that remains weak. Our order book carried good momentum into the second half of the year, driven by continued growth in the demand for low energy buildings," said Gene Murtagh, Chief Executive of Kingspan.

Insulated panel sales were up by 9% and trading profit was up by 30%, reflecting what the company called 'continuing penetration gains, a positive business mix and some improvement in end markets in certain regions". Insulation board sales were up 1% and trading profit was up by 32%, with a good performance in the UK in particular.

US: Ireland's Kingspan, the building materials and insulation group, has purchased the building insulation division of US company Pactiv for US$82m. The deal is Kingspan's first foray into the residential market in the US, where it already has an industrial business.

Pactiv had sales of US$84m in the twelve months that ended on 30 June 2014 and recorded an operating profit of US$10m. The enterprise value is US$82m, of which US$72m is payable in cash on completion plus US$10m of working capital. Gross assets being acquired are US$30m, according to Kingspan.

Gene Murtagh, Kingspan's CEO, said that the acquisition represents 'a new and exciting frontier' for the company's business in North America. "It is a tremendous opportunity to build upon the growing success of our existing insulated panel business throughout the region," he said.

UK: Building product installers are getting help with the Energy Companies Obligation (ECO) from Encon Insulation.

Insulation and wallboard contractors are getting help with access to ECO and Green Deal funding through the launch of an Eco Club by Encon Insulation. Encon's Eco Club is supported by ECO and Green Deal funding provider Effective Energy, as well as manufacturers Kingspan Insulation, Superglass and Parex.

Eco Club members will benefit from support accessing ECO and Green Deal funding, as well as Green Deal cash-back. They will also be eligible for product buying deals and on-going trading incentives. Access to renewable products will be supplied through Amco Renewables. Members will also benefit from access to ECO and Green Deal projects, project data, customer introductions, lead generation and marketing as well as training for the Green Deal installer certification standard PAS 2030.

Encon Insulation have been keen to trial an ECO and Green Deal offer for their existing and potential new customers and have been fine-tuning their Eco Club offer over the past 18 months.

"Often this new, fast-moving market sector is seen as over-complicated, with huge barriers to entry and as a consequence many contractors risk missing the boat. The Encon Eco Club aims to cut through this, keep things simple and allow our customers to enter the ECO and Green Deal arena." Said Mike Beard of Encon. "Initial press has been less than kind to both schemes but they are in play and our Eco Club will help small and medium enterprises to enter and compete with the larger national players. This model will develop over the coming months and enable members to access expertise to get them started and provide projects to work on and competitively priced products with which to carry out the work." He added, "The next steps are to populate the model with Eco Club team members, get working on specific schemes and deliver value for all parties involved."

Ireland: Kingspan Group has reported a particularly slow start to trading in 2013 in an interim management statement. In the release, issued ahead of its annual general meeting, the insulation and building supplies manufacturer said that group sales had risen by 10% to Euro520m for the first four months of 2013. It added that trading had 'picked-up' during March and April 2013.

Kingspan noted that market conditions were weak in UK and the Netherlands. Improvements have been seen in Germany following the group's acquisition of ThyssenKrupp Construction in 2012, and the Irish market saw improvement. The US has had a good start to 2013, Australasia has slowed from 2012 levels and the Middle East and Gulf Cooperation Council regions have remained buoyant.

In its outlook the company noted that a combination of growing order intake levels, improving acquisition benefits and a more diversified geography should help the company in the second half of 2013.

Ireland: Insulation and building supplies manufacturer Kingspan has reported that its operating profit grew by 15% in 2012 to Euro105m from Euro90.9m in 2011. Revenue for the year rose by 55% to Euro1.63bn.

Kingspan reported strong overall performance in insulated panels with sales revenues up by 11%, particularly strong in Germany, Canada and Australia. The company reported 'robust' performance in insulation boards where revenues were up 2%, stable in the UK and slightly up in Continental Europe.

"We are pleased to report another positive year of progress for Kingspan, one in which we continued to increase our profitability, generate strong cash flows and widen our global footprint," said Kingspan's chief executive Gene Murtagh.

UK: PipeHawk, a provider of advanced engineering solutions, has announced that its OM Systems subsidiary secured a contract with Kingspan to deliver a complete new production line, worth over Euro1.25m. The project comprises the provision of a turnkey automated production line to one of Kingspan's UK facilities and will be delivered during 2012-2013 financial year.

Ireland: Kingspan, the insulation and building energy specialists, has reported a 19% increase in trading profits for the first half of 2012. The company made Euro52.7m in 2012 compared to Euro44.2m in the same period in 2011. Revenue remained stable rising by 3%, to Euro757m from Euro736m, but this represented a decrease of 1% on a constant currency basis. Earnings before interest, tax and amortisation rose by 13% to Euro71.9m from Euro63.5m.

By segment both the group's insulated panels and insulation boards businesses revenues remained stable at Euro361.1m and Euro232.1m respectively for the first half of 2012. By region the company's Irish revenue fell by 9.4%, to Euro32.8m from Euro36.2m. Revenue in the UK and the rest of Europe remained stable at Euro303.9m and Euro259.7m respectively despite volumes falling. Revenue in the Americas increased by 10.7% to Euro110.7m and in Australasia it increased by 52% to Euro50.3m.

In its business review the company explained that western Europe was 'hamstrung' by an unusually weak construction environment in the Netherlands, owing in the main to sentiment driven weakness in the residential sector. Germany performed well, as did the core central European markets but sales declined in Russia and Turkey.

"The trading environment across many of our geographies continues to be very uncertain, which is having a moderating impact, albeit with Kingspan continuing to outperform the general markets in which we operate," said chief executive of Kingspan, Gene Murtagh.

Ireland: Insulation materials group, Kingspan has bought ThyssenKrupp Construction from its parent group for Euro65m and the Middle East firm Rigidal Industries LLC for Euro31.4m. Both acquisitions are subject to local approval.

Kingspan said that it has entered into an agreement with ThyssenKrupp Steel Europe AG to acquire 100% of the share capital of the various companies which comprise ThyssenKrupp Construction Group, the leading European insulated panels business.

ThyssenKrupp Construction Group, which includes market-leading brands such as Hoesch, Isocab and EMS, has seven well-invested manufacturing plants in Germany, France, Belgium, Austria and Hungary. The business had sales in the year to 31 March 2012 of Euro315m and recorded an operating loss of Euro5.7m in the period. It has gross assets of around Euro101m.

Separately, Kingspan also announced that it has agreed to acquire 100% of the share capital of Rigidal Industries LLC, a leading Middle Eastern manufacturer of composite panels and roofing systems based in Dubai with an extensive route to market in the Gulf region. It had sales of Euro31.8m in the year to 30 June 2012.

"The ThyssenKrupp business will transform our mainland Europe insulated panels market presence in a region where market penetration is growing, rooted in the need for more energy efficient buildings. The Rigidal Industries LLC business is an excellent platform to develop our existing business and market presence in the Gulf region where demand is growing," said Gene Murtagh, Kingspan CEO.

Ireland: On 11 August 2011 Kingspan Group plc said that it had raised USD200m from a private placement of loan notes, which it will use to pay down bank debt.

The company, which specialises in insulation and energy conservation, said that the notes carry a fixed interest rate of 5.25%. The placement, which was arranged by Royal Bank of Scotland plc, was oversubscribed and increased from USD125m to USD200m, according to Kingspan.

"(The placement) improves our capital structure by lengthening our debt maturity profile at very competitive interest rates and it affords Kingspan significant financing headroom as we seek to develop our business globally," said the group's finance director Geoff Doherty.