It’s a game of two halves for supplier Kingspan

The biggest producer of building insulation in Britain, Ireland, Canada and Australasia attributed a 14 per cent jump in its half-year profit figure to a strong performance in markets such as Germany and central Europe.

But growth slowed in the second quarter as the eurozone area came under further pressure, and a decline in activity in construction markets such as the Benelux and Netherlands is expected to continue in the second half.

“This moderation in recent activity levels coincided with weakening sentiment generally across Europe driven by interminable political indecision,” said chief executive Gene Murtagh. “By comparison to last year it (the second half) is probably going to be weaker.”

The comments echo those made last week by larger Irish building materials firm CRH which said it expected the eurozone’s economic problems to deepen a slide in sales in the second half of 2012, preventing it from raising profits. Kingspan has weathered the downturn by taking advantage of a shift towards more energy-efficient building standards, particularly in its largest market, the UK, which it added had been steady in the first half of 2012.

Kingspan posted a 14 per cent rise on a constant currency basis in operating profit to 52.7 million euros in the six months to end-July, up from 44.2 million the previous year and in line with analysts’ expectations. Revenue rose three per cent to 757.4 million euros while debt was 171.2 million euros, down from 207.2 million a year ago.

The company bumped up its global presence last week with two acquisitions in Europe and the Middle East, including buying the insulated panels arm of ThyssenKrupp for 65 million euros. This comes after buying CRH’s European insulation business last year which boosted its profit by more than a third.

Mr Murtagh said: “Kingspan is very pleased to report another period of progress for the group through a combination of organic growth and the successful integration of acquisitions. The trading environment across many of our geographies continues to be uncertain which is having a moderating impact, albeit with Kingspan continuing to outperform the general markets in which we operate.”

Kingspan entered the access floor market through acquisitions in the UK and the US. In recent years, the group established a network in central and Eastern Europe, North America and Australia.