Sig Plc · LSE:SHI
Sig — Sheffield Insulations Group — FY 2024 Earnings Presentation
35 slides from Sig's earnings presentation, Mar 6, 2025
Slide 1: SIG plc FY 2024 Results
SIG plc FY 2024 Results 5 March 2025
Slide 2: FY 2024 Results Agenda
FY 2024 Results Agenda 1 2 3 Overview Financial Results Business Review Gavin Slark Ian Ashton Gavin Slark CEO CFO CEO 2
Slide 3: Overview
Overview Gavin Slark, CEO
Slide 4: FY 2024 Overview
FY 2024 Overview Good progress on Robust performance in Cost and financial strategic and operational challenging markets discipline changes • Group reported revenue of • £42m operating cost reduction • UK Interiors improvements £2.6bn, down 4% LFL before inflation accelerated in Q4 under new • Restr
Slide 5: Financial Results
Financial Results Ian Ashton, CFO
Slide 6: Key financials
Key financials £'m FY FY 2024 2023 • Market headwinds drove sales decline, moderating in H2 Revenue 2,612 2,761 • Gross margin well managed – decline reflects ongoing LFL sales growth (4)% (2)% competitive pricing pressures in current demand Gross profit 640 700 environment Gross margin 24.5% 25.3%
Slide 7: Revenue
Revenue £39m £83m £16m £2,761m £11m £2,612m FY23 LFL - Volume LFL - Pricing Branch Changes Working Days/FX FY24 • Positive momentum in difficult markets, with year-on-year increase in volumes in Q4 • Purchase price deflation and sales pricing pressures lead to c3% deflation impact on top line, reduc
Slide 8: Revenue detail
Revenue detail Volume, price and total LFL trend yoy LFL % FY24 2% H2 vs H1 Revenue Volume Operating Company H1 24 H2 24 Var FY24 £m UK Interiors (13) (6) 7 (10) 495 - UK Roofing (2) 5 7 2 381 Total LFL UK Specialist Markets (7) (2) 5 (5) 238 UK (8) (1) 7 (5) 1,114 (2)% Pricing France Interiors (7)
Slide 9: Operating profit bridge
Operating profit bridge £20m £53m £43m £25m £42m £11m £18m FY23 Sales Volume Sales Pricing Other GM Changes Opex Inflation Opex Savings FY24 • Drop through from lower sales volumes, but more materially from sales pricing – both input deflation and competitive market pricing • Other gross margin impr
Slide 10: Reshaping our cost base for profitable growth
Reshaping our cost base for profitable growth Operating cost reduction Restructuring programme FY24 (£m) Reported operating cost saving 32 Annualised operating cost benefit of c£37m from programme since H2 2023; £25m profit benefit including Inflation 18 lost GP on closed branches FX (8) • £19m oper
Slide 11: Free cash flow
Free cash flow £67m £105m £16m £7m £13m £2m £4m £35m £39m £8m Underlying Lease Capex Working Cash Other Operating Interest and Tax Free cash flow EBITDA payments capital exceptionals cash flow financing • Modest working capital outflow, reflecting timings of year-end receipts and payments • Cash exc
Slide 12: Balance sheet: extended debt maturities to 2029
Balance sheet: extended debt maturities to 2029 • €300m refinancing completed in October 2024, providing a stable platform for delivery of strategy • Substantial headroom on revised RCF leverage covenant; bond is “covenant-lite”; • Net debt includes £321m of lease liabilities on fleet and estate – s
Slide 13: Technical guidance – FY 2025 expectations
Technical guidance – FY 2025 expectations • Inflation: o Flat to slightly positive yoy input cost inflation for FY 2025 in aggregate o Operating cost inflation expected to be approximately 2-3%; includes UK NIC impact of c£3m p.a. on full year basis • Capex of £15-20m • Net interest charge within th
Slide 14: Business Review
Business Review Gavin Slark, CEO
Slide 15: SIG overview: Our Pan-European operations
SIG overview Our Pan-European operations Ireland 8% Poland 11% France 35% Operating Germany 11% Profit1 by region FY 2024 UK 35% c430 6,700+ c1,100 BRANCHES COLLEAGUES DELIVERY ACROSS SIX FLEET GEOGRAPHIES Note: 1) Underlying operating profit adjusted to exclude Group overhead and Benelux loss. 15
Slide 16: Market conditions
Market conditions Interest rates France & Germany UK • Building and construction markets • Weakest markets among SIG • UK industry confidence indicators (PMI) continue to adjust to a higher geographies in 2024: High-single digit improved in H2 2024 interest rate environment to mid-teen declines in n
Slide 17: Growth drivers – Long-term
Growth drivers – Long-term Image Ageing buildings across Europe Sustainability driven regulation, Construction market growth energy-efficiency and decarbonisation and demand for housing • Interest rates, GDP, population growth • Housing shortage across Europe • Supports long-term demand for insulati
Slide 18: LFL revenue performance
LFL revenue performance LFL1 FY 2024 Revenue (£m) UK Interiors (10)% 495 Germany (2)% 438 France Roofing (8)% 410 UK Roofing 2% 381 Poland (2)% 241 UK Specialist (5)% 238 France Interiors (7)% 200 Ireland 13% 104 Benelux (8)% 104 Note: 1) LFL revenue growth vs FY 2023. 18
Slide 19: Operating margins & profit
Operating margins & profit FY 2024 Operating FY 2024 Operating profit1 (£m) margin1 UK Roofing 3.5% 13.2 France Roofing 2.0% 8.0 France Interiors 3.1% 6.2 UK Specialist 2.0% 4.8 Germany 1.1% 4.7 Poland 1.9% 4.6 Ireland 3.2% 3.3 UK Interiors (0.7)% (3.5) Benelux (4.3)% (4.5) Note: 1) Underlying opera
Slide 20: Medium-term performance target: 5% margin
Medium-term performance target To medium-term Improving the way we operate now Improving our target performance 5% margin Positioning to win in long-term growth market 4 Pillar Grow Execute Modernise Specialise strategy Revenue growth ahead of Cost base improvement New omnichannel platform New head
Slide 21: Grow: Operating companies performing ahead of the market
Grow: Operating companies performing ahead of the market LFL rates demonstrating continued performance ahead of market, strongest in UK Roofing, Germany and Ireland UK Roofing Ireland • Strong 2% FY LFL sales growth relative to weak market • Distribution business experiencing good growth with improv
Slide 22: Grow: Strengthening customer and supplier engagement in Germany
Grow: Continued strengthening of customer and supplier engagement in Germany 22
Slide 23: Execute: Reshaping cost base and restructuring
Execute: Reshaping cost base and restructuring to drive improved profitability Group total UK Interiors Benelux • Netherlands business restructured in • Further reduction in Country and • New MD Howard Luft joined on 1 Q4; closed seven branches and Group corporate overheads October to accelerate ope
Slide 24: Modernise: Good progress on new platforms
Modernise: Good progress on new platforms to drive customer experience Market Progress 2024 Germany • New e-commerce site launched in Q3 2024 • First B2B distributor in Germany to offer end-to-end omnichannel approach integrated across branch network France • New LiTT e-commerce site based on Polish
Slide 25: Specialise: UK Specialist Markets
Specialise: UK Specialist Markets Construction Accessories Building Solutions Performance Technologies A portfolio of performance £121m Accessories and materials for £ 68m Facades, panels and steelwork for £ 48m technology product and fabrication early-stage infrastructure projects warehousing and s
Slide 26: ESG: 2024 progress towards sustainability commitments
ESG 2024 progress towards our long-term sustainability commitments Five key commitments Measure Change FY 2024 FY 2023 Net Zero Carbon by • Net zero carbon emissions 1 Improved 39,289 42,015 2035 Zero SIG waste to landfill by 2025 • % total waste diverted from landfill Improved 96% 94% Health & Safe
Slide 27: FY 2024 Results Summary & Outlook
FY 2024 Results Summary & Outlook FY 2024 Results FY 2025 Outlook Medium to longer term • Robust performance against • LFL sales in first two months flat yoy • Business model and operating prolonged weakness in largest leverage will help drive quick end-markets • H2 weighting to any gradual and mate
Slide 28: Appendix
Appendix SIG Plc FY 2024 Results
Slide 29: Market outlook
Market outlook Construction output forecast in Europe Evolution of expected construction output in Europe (% change in real terms) Europe 11.7% 5.6% 6.6% 6.5% 2.9% 3.7% 1.5% 2.9% 1.6% (0.7%) (0.8%) (3.6%) 2.4% (4.6%) 1.8% 2021A 2022A 2023A 2024E 2025E 2026E 2021A 2022A 2023A 2024E 2025E 2026E 0.6% 5
Slide 30: Growth drivers – Long-term
Growth drivers – Long-term Drivers of structural demand within European construction benefit SIG’s portfolio 1 Energy efficiency and decarbonisation regulations 2 Ageing buildings across Europe 3 Housing undersupply and pent-up demand Regulations support long-term demand for insulation and Significa
Slide 31: Underlying financials by segment
Underlying financials by segment Operating Change Revenue profit/(loss) vs PY Operating Change £'m LFL £'m £'m margin vs PY UK Interiors 495 (10)% (3.5) (1.9) (0.7)% (0.4)% UK Roofing 381 2% 13.2 2.6 3.5% 0.6% UK Specialist Markets 238 (5)% 4.8 (5.5) 2.0% (2.1)% Total UK 1,114 (5)% 14.5 (4.8) 1.3% (
Slide 32: Other items
Other items PBT Cash Impact Impact FY FY FY £'m 2024 2023 2024 Amortisation of acquired intangibles (2.1) (2.8) - Impairment charges (7.3) (33.8) - Net restructuring costs (13.4) (8.0) (7.8) Costs related to acquisitions - (3.2) - Cloud based ERP implementation costs (1.0) (2.2) (0.8) Onerous contra
Slide 33: Cash flow and net debt
Cash flow and net debt £'m FY FY 2024 2023 • Modest working capital outflow, reflecting timings of payments and Underlying operating profit 25 53 receipts Add back: Depreciation & amortisation 80 79 Underlying EBITDA 105 132 • Lease payments increasing yoy; underlying rent increases partially Workin
Slide 34: Net debt bridge
Net debt bridge £8m £5m £62m £8m £105m £35m £13m £16m £7m £497m £458m FY23 Underlying Working Capex Cash Interest and Tax Lease additions/ Payments related Provisions/ FY24 EBITDA capital exceptionals financing renewals to previous Other/FX acquisitions 34
Slide 35: Number of trading sites
Number of trading sites 31 Dec 31 Dec Opened Merged Closed 2023 2024 UK Interiors 34 - (1) (3) 30 UK Roofing 110 1 - - 111 UK Specialist Markets 30 - - (1) 29 Total UK 174 1 (1) (4) 170 France Interiors 39 1 - - 40 France Roofing 102 - - (2) 100 Total France 141 1 - (2) 140 Germany 53 1 - (4) 50 Pol
Sheffield Insulations Group — FY 2024 Earnings Presentation on 6ix