Insulation and building product supplier SIG PLC (LSE:SHI)’s share price fell 13.09% during early trades on Thursday morning after it issued a profit warning.
The company said in a statement that it now expects to deliver underlying profit of £50 million to £55 million for the full year, in light of “weaker” short-term demand.
In July, the company said analysts’ consensus was for it to deliver £74.2 million of operating profit for the full year within a range of between £65.3 million and £84 million, stating midway through the year that its guidance remained unchanged.
Ahead of the release of its audited results for the third quarter, SIG said in a trading update today that group revenue fell 2% in the three months to the end of September.
Revenue was also 1% lower in the first nine months of the year compared to last year.
The insulation provider said there was a “further softening in demand” for its products in September, which affected the newbuild residential segment across most of the geographies it operates in within Europe.
“We expect weaker demand conditions to persist through the rest of the year, with a negligible impact overall from input price inflation or deflation,” the company said in a statement.
Sales volumes and prices were lower than expected and it reported a neutral impact of cost inflation on raw materials.
Sales to Ireland and Benelux were worst affected, down 13% and 8% respectively. UK interior sales fell 3%, while French interiors dropped 2% and exteriors fell 4%. It conversely saw a 7% increase in sales in Poland.
SIG said it still expects to benefit from the impact of its recent restructuring in the second half of the year.