Profit at building supplier SIG has plummeted amid “prolonged challenging trading conditions” across European markets.
Underlying operating profit fell to £11.7m in the first half of the year, close to two-thirds down on the prior year. On a pre-tax basis, the company swung to a £6.6m loss, compared with a £15m gain in 2023.
Revenue also declined from £1.4bn to £1.3bn.
The London-listed group said its performance reflected “challenging conditions” in the UK Interiors market, where it designs anything from ceilings to raised access flooring.
The British flooring market is undergoing one of the toughest periods in years as the cost-of-living crisis reduces consumer spending.
Headlam, the UK’s top flooring distributor, warned in March that market weakness would likely continue throughout 2024.
On the other hand, SIG’s UK roofing business performed well, it said.
Chief executive Gavin Slark said: “Our results in the first half reflect the prolonged challenging market conditions we are currently facing across most of our European businesses.
“In light of these conditions, we took further actions to reduce our permanent cost base in the half, which will benefit us in the future.”
SIG operates in a range of European countries, including France Germany and Ireland and employs more than 7,000 people.
Looking ahead, it expects full-year underlying operating profit to be in the range of £20m to £30m, in line with expectations. The company’s top brass also remains confident in achieving an operating margin target of five per cent in the medium term.