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Kingspan forecasts 33pc profit drop

Building materials group Kingspan has forecast a 33 per cent drop in operating profits for the year due to the downturn in the construction sector and rising raw materials costs.

The company's sales have fallen 9 per cent in the 10 months to 31 October 2008 compared to the same period in 2007.

Chief executive Gene Murtagh said: “The first half of 2008 has seen Kingspan deliver a comparatively robust operating performance against a difficultinternational backdrop where the headwinds of contracting markets, rising raw material costs, and unfavourable foreign exchange movements remain in place.”

The company said that 2009 was "almost certain" to provide even tougher challenges than 2008.

But it said that "the tightening cost control measures, continued investment in growth markets, and a broadening geographic base, together with the opportunity created by high energy prices, should provide Kingspan with a stronger, more balanced position from which to build the business in the future".