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Kingspan Reports 2009 Earnings
1st March 2010
Republic of Ireland based building products conglomerate Kingspan has reported a 33% drop in turnover from €1,673m to €1,126m and a 60% decrease in profit from €157m to €63m during 2009.
Kingspan's Environmental & Renewables Division will be better known to many British and European oil heating technicians as the manufacturer of oil storage tanks under a myriad of brands including Armet, Atlas, Deso, Kingspan GSP, Mayweld, PC Rotomoulding, Roug, Titan Environmental and Titan Eko.
The division's Sensor Systems business unit also manufactures and distributes electronic storage tank gauging equipment and fuel storage accessories; whilst Kingspan Water, Klargester, Entec and Envirocare are amongst the market leaders in the rainwater harvesting and effluent treatment sectors.
Sales at the division decreased by some 37% during 2009 to €168.7million. The company claims this was primarily as a result of bearing the full force of the recession, with over three quarters of revenue being generated from sales within the British Isles. Correspondingly, divisional turnover as a percentage of total Kingspan sales fell from 16% in 2008 to 15% during 2009.
However, despite the harsh economic climate which typified 2009, the Division's operating margin increased from 1% to 1.7%, resulting in a trading profit for the year of €1.8 million before intangible amortisation. Operating profit for 2009 was €1.0 million. The increase in operating margin was in part attributable to increased efficiencies as a result of plant consolidation around a new production site in Portadown, UK.
Commenting upon the company's performance, Kingspan's Chief Executive Gene Murtagh said, "In 2009 we experienced a set of global challenges never encountered before by the business. In the circumstances, the Company delivered a robust and resilient performance having responded to the challenges by overhauling our cost structure and focusing on cash generation. Excellent progress has been made in debt reduction which positions the Company with one of the strongest balance sheets in the industry."
Looking forward to 2010, Mr. Murtagh said, "While the year ahead will present continued challenges, there is now tangible evidence of stability emerging with conditions becoming more predictable than in the recent past. Globally, energy conservation initiatives continue to gather pace which will play to the Group's strengths. Coupled with the strong actions taken to date, it leaves Kingspan in good stead as markets regain stability."
