Materials firm SIG puts 2009 profit at £60m

European supplier of specialist construction products SIG has said in a trading update that its pre-tax profit for the year to 31 December 2009 will be at least £60m, in line with expectations.

This compares with just £33.1m in 2008, when exceptional costs of £104.2m, including redundancy costs and goodwill writedowns on acquired businesses, brought profit down considerably from the 2007 figure of £124.3m.

The trading update came in advance of the materials supplier's preliminary full-year results announcement on 18 March.

SIG's total sales for the year were £2,744m, down 10.1% from this time last year, while like-for-like sales fell 11.5%.

In the UK and Ireland, total sales decreased 20.4% from the previous year, with like-for-like sales in constant currency 22.0% lower than 2008.

The update said: “Exceptionally challenging market conditions persisted throughout 2009, with the economic downturn significantly reducing construction activity and hence demand for the products and services supplied by SIG.

“The scale of the decline varied by geography and market sector, with a number of SIG's mainland European countries of operation less heavily affected than the UK and Ireland.

“While trading patterns within individual countries and business streams remained inconsistent through to the year end, as H2 2009 progressed there were slight indications in some areas of a slowing in the rate of decline. Overall sales in the period were within the range anticipated by management.”

The trading updated added that the outlook for 2010 remained challenging but that the firm was in good shape to deal both with the fact that several of its end markets are continuing to weaken and “to take advantage of their subsequent later recovery and of any growth opportunities which may emerge”.