Kingspan Group PLC (LON:KGP), the building insulation specialist, has elected not to restore dividend payments while the outlook for its markets remains so uncertain.
The first half of 2020 saw revenue fall by 8% to €2.07bn from €2.24bn the year before – the fall would have been 13% but for the contribution of recently acquired companies – with the coronavirus pandemic taking much of the blame for the fall, although Kingspan conceded that sales activity was “relatively weak” before much of the world went into lockdown mode.
The firm reportedthat profit before tax slid to €177.5mln from €208.9mln in the first half of last year.
The group's debt position improved from a year earlier, with net debt at the end of June standing at €437.9mln, compared to €734.3mln. Free cash flow improved markedly to €260.4mln from €80.6mln the year before.
“Performance has varied substantially from region to region depending on the severity and length of Government restrictions, and been helped by our rapid introduction of cost containment measures,” Gene Murtagh, the chief executive of Kingspan said in the results statement.
“We have decided it is prudent not to pay an interim dividend and our shareholder returns policy is under review. We expect that the economic environment will remain weak, with confidence for businesses to make investment decisions curtailed. On a more positive note, policymakers are more focussed on ensuring buildings are more energy-efficient, which is a supportive long-term trend," he added.