Local radiator manufacturer gears up for £350m flotation ahead of winter demand

Stelrad, which employs 300 people at its UK manufacturing site in South Yorkshire, is a leading specialist manufacturer and distributor of steel panel radiators in the UK,

Europe and Turkey.

From its manufacturing site in Mexborough, the firm makes an extensive range of standard and premium steel panel radiators, low surface temperature radiators, towel warmers, decorative steel tubular radiators and other steel column radiators. It has more than 500 customers.

The IPO is expected to value the business at around £350m.

The origins of the group date back to the 1930s and Stelrad has long established commercial relationships with many of its customers, having served each of its top five customers for over 20 years.

The firm said it has a track record of sales growth, having generated sales revenue of £197m in 2020 and delivered a 5.2 per cent compound annual growth rate in sales from 2015 to the end of 2019, which rises to 6.8 per cent when excluding sales to Turkey.

Stelrad said that its business model has proven resilient, through the three major disruptive market events of the last 15 years, being the 2008 financial crisis, Brexit and the Covid-19 pandemic. The group said that its financial performance experienced only a limited impact from the pandemic.

Bob Ellis, chairman of Stelrad, said: “The European countries where the group operates have been progressive in advancing the decarbonisation agenda through strong regulation and policies and Stelrad’s products will play a key role in the longer term transition away from traditional gas boilers with larger surface area radiators in particular being well suited to low temperature systems such as heat pumps.

Trevor Harvey, chief executive of Stelrad, added: “Our successful growth strategy has been built upon a combination of standardised product design across all our manufacturing facilities, a key focus on specifiers across all of our end-markets and continued range innovation, alongside our multi-brand strategy that enables products and brands to be tailored to specific channels.

"As a result, we are the number one steel panel radiator business in a number of the markets where we operate.

“Hydronic systems dominate the heating market and steel panel radiators remain by far the most popular heat emitter with demand driven by both first-time installations and replacements.

"The overall market value is growing thanks to positive underlying market activity and continued adoption of premium panel radiators with the move towards decarbonisation presenting numerous opportunities and limited disruption to our longer-term growth plans.

“Our extensive product offering, strong relationships with all major distributors and specifiers plus this supportive market backdrop mean that we are confident of delivering further upside as part of our growth plan as we continue to play a leading role in keeping Europe warm.”