SIG (LON:SHI) Releases Quarterly Earnings Results

SIG (LON:SHI) released its earnings results on Tuesday. The company reported GBX (1.90) earnings per share (EPS) for the quarter, Digital Look Earnings reports. SIG had a negative net margin of 2.47% and a negative return on equity of 47.73%.

Here are the key takeaways from SIG’s conference call:

• Weak markets pressured first-half results: Like-for-like sales declined 1.5%, underlying operating profit fell to about £11 million from £15 million, and the margin decreased 40 basis points to 0.8%. Management expects subdued demand to continue through the second half, with full-year operating profit around £25 million.
• Management delivered £10 million of cost-saving benefits in H1 through procurement, restructuring, branch closures and overhead actions, and plans to accelerate these initiatives despite the lack of a near-term market recovery.
• SIG is targeting a £50 million operating-profit run-rate improvement by mid-2028, at least £100 million of cash generation by the end of 2027 and leverage below 3x net debt-to-EBITDA. However, leverage currently remains high at 5x, with net debt of £532 million.
• UK Roofing continued to outperform, with estimated market outperformance of 4%, improved operating margins and £6 million of free cash flow. Growth opportunities include solar roofing, digital capabilities, selective network expansion and AI-enabled pricing and inventory management.
• Benelux returned to profitability, while Poland, Ireland and the Netherlands remained growth areas; the planned closure of loss-making Belgian subsidiary MPA could provide an additional improvement opportunity, as it incurred an approximately €500,000 loss in H1.

SIG Stock Performance

LON:SHI opened at GBX 8.50 on Tuesday. The company has a current ratio of 1.52, a quick ratio of 1.10 and a debt-to-equity ratio of 499.09. The company has a market capitalization of £98.24 million, a P/E ratio of -1.55, a price-to-earnings-growth ratio of 1.29 and a beta of 0.67. The firm has a 50-day moving average price of GBX 8.26 and a two-hundred day moving average price of GBX 8.73. SIG has a twelve month low of GBX 6.72 and a twelve month high of GBX 14.31.

Analyst Upgrades and Downgrades

Several research analysts have issued reports on the company. Royal Bank Of Canada cut their price objective on SIG from GBX 8.70 to GBX 8 and set a “sector perform” rating for the company in a research report on Wednesday, April 29th. Jefferies Financial Group reduced their price objective on shares of SIG from GBX 9 to GBX 8.90 and set a “hold” rating for the company in a research note on Tuesday, May 12th. Finally, Peel Hunt restated a “buy” rating and set a GBX 14 target price on shares of SIG in a research report on Tuesday. One equities research analyst has rated the stock with a Buy rating and two have given a Hold rating to the company. Based on data from MarketBeat.com, the stock presently has a consensus rating of “Hold” and an average price target of GBX 10.30.

About SIG

SIG is a leading pan-European provider of specialist insulation and sustainable building products and solutions, differentiated through specialist knowledge, product mix and end markets.

We connect over 75,000 customers with thousands of leading and specialist products and brands from our suppliers. We use our network of around 430 winning branches across local markets with superior customer service, specialist expertise and on-time delivery to add value to both our customers and suppliers.