Cavan, Ireland - Kingspan Group plc, a manufacturer of rigid insulation, has reported a 10 percent drop in turnover in its preliminary financial results for the full year 2008, including mixed performances from its polyurethane businesses.
The company's polyurethane Insulation Boards unit reported that, although performing well in western and central Europe, sales were down from Euro 284 million ($357 million) in 2007 to Euro 250 million in 2008. Volume contracted 12 percent in the year because of a "tough backdrop to UK and Ireland housing markets," Kingspan said. This trend is expected to continue through 2009, the company said, adding that new capacity in Poland will be postponed until 2010/2011.
Kingspan's Insulation Panels business reported sales were up to Euro 235 million from Euro 214 million in 2007 in the CEMEI (central Europe, Middle-East, India) region and up to Euro 73 million from Euro 44 million in 2007 in north America. In the UK, Ireland, and western Europe, sales fell from Euro 506 million in 2007 to Euro 416 million in 2008. The company said volume dropped 17 percent in the UK and 32 percent in Ireland, but was up by 17 percent in the rest of western Europe.
For the group as a whole, turnover was down 10 percent to Euro 1673 million, pre-exceptional operating result fell 33.6 percent to Euro 157 million and working capital was reduced by Euro 44 million. Kingspan achieved Euro 76 million in annualised savings since late 2007 and invested a total of Euro 193 million in 2008. The company said it has curbed capital expenditure for 2009/10, now planned to be around Euro 50 million.
"In 2008, we saw a global economic downturn and a dislocation in financial markets not seen in many years," said Kingspan ceo Gene Murtagh. "Kingspan responded quickly and decisively to these changing conditions with a cost reduction programme and a focus on operational efficiencies that provides the group with an appropriate cost base to meet the anticipated economic headwinds. 2009 will present greater challenges than the year gone by and the prime focus is cost and cash management throughout the organisation," he added. (RD)