Revenue up 6pc at Polypipe despite cost deflation impacts

David Hall, Polypipe
David Hall, Polypipe
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Cost Deflation and weaker-than-expected demand from the repair sector dampened sales growth at plastics firm Polypipe.

Despite this, the Doncaster-based business saw a 5.9 per cent rise in revenues for the 10 months to October 2015, to £299.3m.

Excluding acquisitions - the firm bought water damage specialist Surestop and ventilation provider Nuaire earlier this year - group revenue was up 3.1 per cent on a like-for-like basis, Polypipe said in a trading update.

UK like-for-like growth was 2.9 per cent over the period. In the four months to October, it declined 0.8 due to polymer price pressure and slowing segment demand.

While the firm saw weaker-than-expected demand from the residential repair, maintenance and improvement sector, it saiddemand from the residential new build segment remained robust.

Currency fluctuations hit the business’ European sales, with reported revenue down 9.1 per cent year-on-year. However, this represented 1.5 per cent growth on a like-for-like basis.

Chief executive David Hall said that despite cost pressure, falling demand and a reporting period that was two working days shorter than last year, the company was trading on plan in the period.

He said: “As a result of margin improvements, we are trading in line with plan after ten months and expect our full year underlying operating profits to meet market expectations.”

He added that the Nuaire ventilation business, which was acquired in August, is trading in line with expectations.