Stelrad Group PLC (LSE:SRAD) reported a slump in profit for the half year, even though the radiator maker's revenue heated up nicely.
In its first set of interim results since floating in London last November, the manufacturer of steel panel radiators in the UK, Europe and Turkey's pre-tax profit slumped 62.1% to £4.7mln, with a 33.5% loss in statutory operating profit at £11.9mln.
"As a result of inflation in Turkey exceeding 100% over a three-year period, the group was required to adopt IAS 29 in respect of its Turkish subsidiary for the first time in the financial statements for the six months ended 30 June 2022," the company said in a statement.
Revenue for the six months ended June 30 jumped 17.4% to £150.1mln, as the performance was underpinned by "margin management" amid growing steel, logistics and energy costs.
Adjusted operating profit jumped 13.1% to £19.0mln due to "optimisation" of its Turkish facility and sales of premium steel panel radiators, though adjusted operating profit margin decreased 0.4pp to £12.7mln.
The company has recommended an interim dividend of 2.92p per share.
"Rising energy costs across Europe are sharpening consumers' focus on the need for more energy efficient heating solutions and this, combined with the ongoing decarbonisation agenda, is expected to drive increased, long-term demand for our products," said Trevor Harvey, chief executive.
"Whilst we continue to monitor the challenging economic conditions in our end markets closely, we remain confident in the outcome for the full year."
Shares were down 2.6% at 191p.