SigmaRoc shares (LON:SRC) ended the opening session of the week with gains of 5.86%, extended the YTD rally to 68%. The share price came within 0.6p of 52wk highs at 125.60p intra-day off the back of a strong H1 print.
The company's interim results for the six months ended June 30, were strong, in challenging market conditions and has boosted confidence in SigmaRoc meeting full-year expectations.
Revenue reached £510.3 million, a 13.4% increase compared to £450.1 million in H1 2024. EBITDA surged by 36.9% to £108.8 million, resulting in an EBITDA margin of 21.3%, a significant 370 basis point improvement. Profit before tax saw a substantial rise of 61.8%, reaching £39.5 million, and EPS soared by 873.9% to 2.24p.
Underlying results also demonstrated strong growth, with EBITDA up 21.2% to £117.8 million and EPS increasing by 51.8% to 4.66p. Net debt decreased by 6.4% to £498.4 million, and covenant leverage improved to 2.04x. Free cash flow also increased significantly to £61.9 million.
Despite a slight 1% reduction in proforma revenues due to volume decreases, underlying EBITDA increased by 2%, driven by synergy delivery and cost control. The underlying EBITDA margin improved by 60 basis points. These results reflect SigmaRoc's ability to navigate market challenges effectively.
Key Drivers of Performance:
- Synergy Realization: The company delivered £13 million in synergies through commercial and operational initiatives, including a 6% headcount reduction in the Central region.
- Effective Cash Management: Strong cash management led to improved covenant leverage and free cash conversion, enhancing financial flexibility.
- Strategic Initiatives: Completion of the second tranche of ready-mix asset divestment in Northern France and investments in ultra-low carbon building materials through SkreenHouse.
Max Vermorken, CEO, commented:
“The Group has performed very strongly in a challenging market backdrop and demonstrates again how skilled the local teams are. Certain customers experienced disruptions or temporary shutdowns making the task even harder. The market certainly did us no favours in the first half, a trend which is likely to continue in H2.”
He also highlighted the strong performance in the UK and Ireland, as well as the Nordics region.
Looking ahead, SigmaRoc anticipates similar market conditions in the second half of the year and remains focused on operational efficiency and cost management. Synergies for 2025 are expected to exceed previous guidance, reaching at least £21 million, assuming steady market conditions.
Additionally, the confirmed German infrastructure stimulus and expected increase in European defense spending are anticipated to positively impact volumes. Shares are up 72% YTD.
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