SIG returns to profit in H1, sees FY underlying profits beating prior expectations

(Sharecast News) - Construction products supplier SIG said on Tuesday it had returned to profit in the first half of 2021 as like-for-like sales and gross margins improved throughout the period.
SIG said group like-for-like sales were up 33% on the prior year, and 1% on 2019, while interim gross margins of 25.9% were 100 basis points higher than at the same time in 2020.

As a result, interim underlying operating profits came to £13.6m, a marked turnaround from the £42.9m loss reported at the same time a year ago, while first-half underlying pre-tax profits were £3.0m, up from a loss of £53.8m in 2020.

SIG highlighted that the impact of material shortages and cost price inflation had been successfully managed to date and, with trading in July and August remaining "solid", strengthening the firm's confidence in its full-year outlook despite caution over said shortages and cost price inflation.

The London-listed firm expects continued profit improvement in the second half and now anticipates that full-year underlying operating profits will be ahead of prior expectations.

Chief executive Steve Francis said: "The strong revenue growth across our broad product offering, together with disciplined margin management, has been key to delivering an earlier and stronger profit than previously anticipated.

"As a result, providing the disruption from these headwinds does not worsen, we now anticipate full-year underlying operating profit will be ahead of our prior expectations."

As of 0915 BST, SIG shares were up 1.08% at 50.40p.