Insulation industry news from Global Insulation

Demnark/The Netherlands: Rockwool's board of directors has approved a plan to invest Euro23m in a major expansion of its Rockpanel cladding board business. The investment will be allocated to establishing a new state-of-the-art press line at the group's plant in Roermond in the Netherlands.

Rockpanel cladding boards are used as decorative and weather-protecting building elements on facades, dormers and rooflines. The main sales are in north-western Europe with Benelux, Germany, Denmark and UK accounting for the majority of the business. Sales of Rockpanel boards have seen strong double-digit growth in recent years and this is expected to continue both in the existing geographies as well as in new European markets.

Commenting on the expansion plan, CEO Eelco van Heel said, "The aesthetic and technical benefits as well as the strong sustainability profile have made the Rockpanel boards increasingly popular amongst architects and installers. We are confident that we can turn this business into a strong European player which can contribute significantly to the future of the Rockwool Group."

Denmark: The Board of Rockwool International A/S has approved the company's annual report for 2011. The report shows that the group's sales increased by 17.2% to Euro1.85bn. Rockwool's profit after minority interests increased by 25% and came to Euro86m, with investments at Euro161m. In 2012 sales are expected to increase by 5% with profit after minority interests of more than Euro80m. Investments excluding acquisitions is expected to be around Euro188m.

"Despite the turbulent state of the world economy in 2011, the year produced many positive developments in the Rockwool Group," wrote Rockwool's CEO Eelco van Heel in the report. "We managed to grow sales by 17% and, even though there was strong pressure on raw material prices, we also maintained our profitability at more or less the same level as the previous year."

Van Heel added that Rockwool had been less adversely affected than other areas of the construction industry because European countries such as France and Germany are looking to increase efficiency during times of economic hardship. He also noted that Rockwool had been expanding its activities outside of Europe and had grown its 'Systems' business.

Rockwool's insulation business, representing 82% of its net sales showed a solid growth trend throughout 2011. Sales grew by 20% although customers resisted price increases at the start of the year. The increase was predominantly driven by the renovation market, especially in Europe and North America. Sales in Russia were up by 45% year-on-year. Rockwool met this demand with imports from its Polish facilities.

In the US, Rockwool completed an important agreement with the home-improvement chain Lowe's. This has given access to more than 200 stores in north-eastern US, helping Rockwool make the most of this challenging market.

UK: Superglass Holdings plc, an independent UK manufacturer of glass wool mineral fibre insulation products, has announced that sales in the first half of its fiscal year, which ended 29 February 2012, were significantly ahead of the first half of the preceding fiscal year. Despite the improvement the results were still behind the company's own forecast. The company said that it expects the second half of the fiscal year to be significantly better than the first half, with increased volumes, increased selling prices and the benefits of sales specification activity taking effect.

Superglass said that financial difficulties prior to its successful recapitalisation impacted trading adversely during the period under review, but that a shortfall in sales has been partially mitigated by lower costs. The board reviewed the progress achieved in the three months since the recapitalisation as 'satisfactory.'

On 21 February 2012 Superglass announced that its Finance Director, Tony Kirkbright, had resigned with immediate effect following the company's successful recapitalisation. The company board has started the process of recruiting his replacement. In the meantime David Wilton has been appointed as a consultant. He will report to board on the financial affairs of Superglass on an interim basis.

The company also said that it was still too early to assess the real impact of the transition the UK's new environmental policy, the Green Deal, which takes effect at the beginning of 2013.

France: Saint-Gobain has posted a net income of Euro1.3bn for 2011, a rise of 14% from Euro1.1bn in 2010. The group has attributed this to strong demand for its building materials in emerging markets combined with its ability to pass higher raw material costs to customers in the form of higher prices.

Recurring net income spiked to Euro1.7bn in 2011, a 30% rise from Euro1.3bn in 2010. Operating income rose to Euro3.4bn, a 10% rise compared to Euro3.1bn. Group sales increased to Euro42bn, a 5% rise from Euro40bn.

"We managed to limit the impact of the strong increase of raw material and energy thanks to the increase of the prices of our products," said chief executive Pierre-Andre de Chalendar.

De Chalendar added that he expects a moderated growth of revenues in 2012 as the company intends to continue transferring higher costs to its products' prices. He declined to give specific data, though he said the growth will be slower than the 5% in 2011.

In its Interior Solutions division (which includes insulation) the group recorded sales of Euro5.5bn for 2011, a rise of 6.1% from Euro5.2bn in 2010. Operating income met Euro450m in 2011, a rise of 19% from Euro380m. Notably capital expenditure increased to Euro330m, a rise of 70% from Euro190m. Overall the group doubled investment spending for 2011, in energy efficiency and energy markets, to almost Euro900m.

Sales volumes for Interior Solutions were up in all geographic areas, particularly in the US, Asia and emerging countries. In Western Europe and especially France, trading continued to be buoyed by stricter energy performance regulations.

Saint-Gobain's CEO has announced an ambitious expansion plan to boost total revenues to Euro55bn and net profit to Euro3bn by 2015, through acquisitions and organic growth. The company said the plan to spin off its unit Verallia is still being considered, but market conditions are not favourable in the short term.

US: Owens Corning (OC) has swung to a fourth-quarter profit due to prior-year acquisition-related costs as the company continued to see stronger sales in its building materials. OC saw sales improve for its roofing and insulation materials in 2011 despite the ongoing slump in the US housing market. A focus on costs has helped support its bottom line.

OC reported a profit of US$50m for the fourth quarter of 2011 from a year-earlier loss of US$110m. The year-earlier period included a net US$135m in asset-sales losses and acquisition and restructuring-related charges. Its revenue increased by 2.4% to US$1.2bn and its gross margin rose to 19.2% from 17.1%. The building materials segment, OC's biggest area, reported net sales growth of 8%, including an increase of 8.7% in insulation sales.

Chairman and Chief Executive Mike Thaman said that OC anticipates improved US housing starts and modest growth in the global economy in 2012. The company expects that a strong performance in its building materials business will more than offset impacts of near-term market challenges in its composites business.