SIG Plc improves FY 2016 sales on forex boost

SIG Plc said group sales in 2016 were about £2,738m, an increase of 11.2% compared to prior year, having benefited from forex movements (+6.9%), acquisitions (+3.7%), and working days (0.3%).

On a like-for-like ("LFL") basis Group sales increased 0.3%.

"In line with previous guidance the Group continues to expect that underlying profit before tax for 2016 will be within its previously stated £75m to £80m range, and that gross margin will be around 30bps lower than prior year," the company said in a statement.

"In the UK & Ireland LFL sales in the year increased 1.1%, with SIG Distribution up 1.2% and SIG Exteriors down 1.5%. In Mainland Europe LFL sales declined 0.5%, with France and Germany down 2.0% and 1.3% respectively."

SIG's leverage as at 31 December 2016 is expected to be c.2x (net debt to EBITDA), above its medium-term target of 1 - 1.5x.

"Going forward the Group will prioritise leverage reduction by more tightly focusing on its cash generation, moderating capital expenditure and suspending its infill acquisition programme," SIG said.