Distribution giant SIG plc has reported growth in the UK for the year to 31 December 2014. In an announcement this morning SIG revealed that like-for-like sales increased by 3.8% and a rise in underlying operating margin to 4.2%.
SIG said it began the year strongly increasing like-for-like (“LFL”) sales by 7.1% in the first half, with good growth in both the UK & Ireland and Mainland Europe. The Group’s trading performance then moderated in the second half, with LFL sales increasing marginally, by 0.8%.
For the year as a whole SIG delivered good LFL sales growth of 3.8%, with the Group experiencing marginal product price inflation of 0.1% and a volume increase of 3.7%. Given SIG estimates that the overall market was up by 1.0%, this equates to an outperformance of 2.8%.
Group sales from continuing operations were up 2.5% to £2,602.9m (2013: £2,539.7m), despite the adverse effects of foreign exchange translation, which reduced sales by 3.1%.
In the UK & Ireland revenues from continuing operations increased 11.3% to £1,336.2m (2013: £1,200.3m), and were up 9.2% on a LFL basis, having been driven primarily by strong demand in the UK and Irish residential sectors. In the UK LFL sales increased by 8.9% and in Ireland were up by 14.7%.
Underlying operating profit increased 8.8% to £110.2m (2013: £101.3m) and underlying operating margin was up to 4.2% (2013: 4.0%). On a statutory basis profit before tax was £39.0m (2013: £2.1m) and basic earnings per share were 5.6p (2013: loss of 2.5p).
Stuart Mitchell, Chief Executive, said: “In 2014 SIG delivered good like-for-like sales growth of nearly 4% and improved its return on capital employed by 90bps, driven by a strong performance in the UK & Ireland.
“We anticipate that trading conditions will remain variable across the Group’s countries of operation in 2015, with continued good growth in the UK & Ireland and uncertainty persisting in Mainland Europe.”