The company said the results reflect adverse trends in the European construction market in the light of higher inflation and interest rates which led to shrinking market volumes. “This has resulted into shrinking market volumes, with margin pressures in our insulation boards activity being especially fierce in the second half,” said CEO Jan Vergote. “The full effect of the drop in the number of new building permits has yet to be seen, whereas renovation markets seem somewhat more resilient.”
However, he said, from the fourth quarter of 2023, the decrease in volumes in insulation boards had stopped, and year-on-year sales volumes and markets share both increased for insulated panels.
“A combination of planned and unplanned production stops at our suppliers’ facilities, as well as longer supply lines due to the geopolitical issues in the Red Sea, is resulting into MDI price hikes and potential shortages, which will require us to increase sale prices accordingly,” Vergote said.
He added that as well as implementing cost reductions, the company is focusing on innovation to address the challenges posed by the transition to sustainable construction. “Despite the low visibility on the timing of a potential market recovery, we are confident that we will significantly increase our adjusted EBITDA compared to 2023,” he said.