British construction materials provider SIG PLC (LSE:SHI) slashed 250 roles in the first half as part of a restructuring effort to wrest the group away from plummeting profitability.
It comes amid the “prolonged challenging market conditions we are currently facing across most of our European businesses”, chief executive Gavin Slark said in an interim trading update.
“In light of these conditions, we took further actions to reduce our permanent cost base in the half, which will benefit us in the future,” he added.
The maker of insulation, cladding and ceiling tiles said it will further reduce headcount by not replacing staff who leave. “Some of the latter may be temporary reductions, depending on when and to what extent volumes return, and others will be permanent,” the company said.
SIG’s revenues fell 8% year on year to £1.3 billion on a sub-1% operating profit margin, the results revealed, reflecting weak demand for construction products across all jurisdictions.
This included “prolonged” weak demand in France, where product volumes to new build construction projects were weaker in both residential and commercial.
The UK interiors business was also hit by what it called “lower volumes and weaker market demand”.
SIG is hoping to restore operating profit margins to 5% via these cost-reduction plans. Operating profit margins were slightly above 2% in the 2023 interim period.
The company had more than 7,000 employees at the end of its 2023 financial year.