Materials supplier SIG suffered a 5.7 per cent drop in its UK turnover last year, citing an “increasingly challenging” market caused by economic uncertainty.
The firm released a trading update this morning, revealing that conditions deteriorated throughout the year with trading in December being particularly challenging.
Preliminary results from the company showed revenue from the UK and Ireland down 8.8 per cent in the second half of 2018 compared to the same period in 2017.
Sales on mainland Europe, where the company has significant operations in France, Germany and Poland, were up 0.7 per cent year on year.
SIG has forecast an adjusted pre-tax profit of £75m for the year ending 31 December, compared with a £79.2m underlying pre-tax profit in 2017.
SIG’s shares plunged more than 9 per cent when the market opened before recovering slightly to around 7 per cent down by mid-morning.
Analysts at Peel Hunt said market conditions are unlikely to improve for SIG in 2019, but cost-cutting at the firm was starting to deliver better margins.
Last year saw the firm embark on a transformation programme designed to cut overheads and dispose of non-core businesses.
This involved the sale of offsite construction outfit RoofSpace and façade panel manufacturer Proteus. It also sold its loss-making modular business Building Systems for a nominal fee of £1 last February.
In today’s update the company said it expected its transformation programme to yield a “significant increase in profitability in 2019”.
SIG’s full 2018 results will be released on 8 March.