SIG reports strong 2011

Building products distributor SIG capped a strong year with a 27 per cent jump in profits in 2011, as it benefitted from improved trading conditions.

Underlying pre-tax profits came in at the top end of expectations at £81.7m, with earnings per share reaching 9.4p, also a 27% increase on the year before.

The company announced a final dividend of 1.5p per share, taking the total dividend for the year to 2.25p.

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SIG said growth was driven by improved trading conditions, with market volumes increasing by around 1% compared to 2010.

It also benefitted from product price inflation of around 3% across the group as well as outperforming the market by about 3%.

In mainland Europe revenues were up by 11.3% to £1.54bn, with France demonstrating the most marked progress of the countries in which SIG operates.

It put this performance down in part to the group's investment in new branches in recent years, which SIG said were contributing significant additional sales and profit as they matured.

In the UK & Ireland revenues from continuing operations increased by 3.7% to £1.2bn, with sales in the UK up by 3.9% and down marginally in Ireland by 0.5%.

The company gave a mixed picture in terms of its outlook for 2012.

"Sales per day in constant currency so far this year were around 1% ahead of strong prior year comparators, despite the impact of severe weather across Mainland Europe in February this year," it said.

But it added that "given the ongoing uncertainties in the macroeconomic environment, the group continues to expect market volumes to be slightly down overall in 2012".