StockMarketWire.com - Specialist building products supplier SIG said it expected to deliver a 'significant' profit improvement in the second half despite challenging conditions, as margin improvement offset falling revenue.

Revenue from continuing operations in the four months through October fell 2.3%.

Like-for-like revenue fell 3.6%.

SIG said the UK construction environment weakened during the autumn, owing to macro-economic uncertainty and slowing house price inflation.

Trading conditions in construction markets across mainbalnd Europe had also softened since June, notably in France as anticipated.

However, SIG said it was now seeing tangible progress from a strategic review.

'Whilst the planned withdrawal from unprofitable business has reduced revenue, improved management of pricing and customer profitability is increasing gross margins ahead of expectations,' it said.

'In addition operating costs are falling, with reductions in headcount delivered in the Period as anticipated and further planned reductions on track for completion by 31 December 2018.'

'While market conditions are challenging, the transformation of SIG's businesses progresses as planned.'

'As such, management remains confident that the group will see significant profit improvement in the second half of the year and deliver a result in line with its expectations, driven by higher gross margins and lower operating costs.'



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