25 May 2016 07:00
Polypipe Group plc
Trading Update
___________________________________________________________________________________
25th May 2016
Polypipe Group plc ("Polypipe" or the "Group"), issues this update on trading for the four months ended 30th April 2016 ahead of its Annual General Meeting which takes place at 10:30 am today at the Holiday Inn, High Road, Doncaster, DN4 9UX.
Polypipe will report its interim results for the six months ending 30th June 2016 on 16th August 2016.
Trading Results
The revenue performance for each reporting segment was as follows:
Four months | Four months | ||||
Revenue | ended April 2016 | ended April 2015 | Change | ||
£m | £m | %
| |||
Residential Piping Systems | 70.6 | 59.4 | 18.9 | ||
Commercial and Infrastructure Piping Systems - UK | 60.9 | 39.6 | 53.8 | ||
Inter Segment | (3.4) | (3.1) | |||
UK Operations | 128.1 | 95.9 | 33.6 | ||
Commercial and Infrastructure - Mainland Europe |
21.2 |
17.0 |
24.7 | ||
Inter Segment |
(0.4) |
(0.5) |
| ||
Group |
148.9 |
112.4 |
32.5 | ||
Group revenue for the four months ended April 2016 was 32.5% ahead of the comparative period in 2015. This revenue growth comprised:
Organic growth | 9.7% | (UK operations 8.0%) |
Acquisitions | 21.4% | |
Currency | 1.4% | |
Total revenue growth | 32.5% |
UK Operations
A favourable market backdrop combined with an element of re-stocking and additional stocking ahead of our price increases by merchant customers has delivered strong organic revenue growth of 8.0% for the four months ended April 2016. Our ventilation business, which now includes Nuaire, has also continued to perform strongly. Residential new build volumes (c. 24% of Group revenue in 2015) have remained robust and we are encouraged by signs of improvement in the private RMI sector (c. 27% of Group revenue in 2015). The UK's infrastructure projects pipeline is developing as forecast, which combined with infrastructure for new residential development, has helped drive strong sales growth for our water management products. Export sales to the Gulf region have also performed well in the period and we are making good progress with setting up a manufacturing unit to produce some of our most space hungry water management products in Dubai.
Operating margins for our UK operations for the four months ended April 2016 were ahead of the comparative period in 2015 due to the operational gearing benefits arising from the organic revenue growth.
Mainland European Operations
Reported revenue for the four months ended April 2016 was 24.7% ahead of the comparative period in 2015. Revenue growth on a constant currency basis was 18.2%. The market in France appears to have stabilised and is showing early indications a slight upward trend and we have gained some market share and also benefitted from some merchant restocking. The business continues to be profitable but at low margins.
David Hall, Chief Executive, commented:
"Our growth initiatives combined with the continued positive fundamentals in our main UK market have delivered an excellent start to the year. Whilst we remain alert to the potential impact of continuing short term economic and political uncertainty in our core UK market, with this strong start we believe that the Group is well positioned to deliver results for the full year in line with expectations".
Contacts:
Polypipe
David Hall, Chief Executive Officer
Peter Shepherd, Retiring Chief Financial Officer (for queries to 3rd June 2016)
Martin Payne, Incoming Chief Financial Officer
+44 (0) 1709 770 000
Brunswick
Mike Smith
Nina Coad
+44 (0) 20 7404 5959
A copy of this trading statement will be available on our website
http://ir.polypipe.com/(http://ir.polypipe.com) today from 7.00 am.
Notes to Editors:
Polypipe is the largest manufacturer in the United Kingdom, and among the ten largest manufacturers in Europe, of plastic piping systems for the residential, commercial, civils and infrastructure sectors by revenue. The recently acquired Nuaire business is a leading designer and manufacturer of energy efficient ventilation systems in the UK.
The Group operates from nineteen facilities in total, and with over 20,000 product lines, manufactures the United Kingdom's widest range of plastic piping systems for heating, plumbing, drainage and ventilation. The Group primarily targets the UK, French and Irish building and construction markets with a presence in Italy and the Middle East and sales to specific niches in the rest of the world.