SIG plc has issued a trading update for the third quarter of its financial year ending 31 December 2021.
The update confirms that the solid trading performance seen by the company in July and August continued through September.
As a result, like for like sales growth in Q3 was 17% compared to the prior year. This follows the 33% reported in H1, a number distorted by the material Covid impact in 2020. Against pre-Covid 2019 comparatives, Q3 growth was 9%, up from the 1% growth seen in H1.
UK Distribution performance provided the principal driver for the acceleration in growth during Q3, with the business moving, as expected, back to growth against 2019 monthly comparators, as the strategic and operational changes made since July 2020 continue to drive the return towards its previous market position and performance.
The company's France and UK exteriors businesses, and its Poland business, continue to perform very strongly. Ireland was, as anticipated, a further driver for the Q3 acceleration, rebounding after the H1 impact of local Covid-related restrictions.
As previously reported, inflation is also adding to the top line in all geographies, with the Group continuing to pass through cost increases. Profitability continued to improve in the quarter compared to the first half, despite the typical modest seasonal dip in sales volumes in August.
While supply issues persist across many product groups, order books continue to build and the outlook for materials shortages has become clearer. The board says it is mindful of the potential impact of these shortages should the situation persist for an extended period, but remains highly confident in the effectiveness of its supply chain management and commercial agility. As a result of the continued strong sales momentum and operating performance, SIG is more confident in its near term outlook and expects full year underlying operating profit to be ahead of current market forecasts.
