Polypipe logs record result despite headwinds
Despite a “backdrop of challenging market conditions,” plastic pipe-maker Polypipe has reported record financial results for 2018. Having sold its French business in the first half of the year, Polypipe’s main exposure is to the UK market, rather than Europe. On the one hand, that provides some reassurances – it won’t have to deal with the kind of cross-border issues that many firms are preparing for (in the eventuality of a no-deal Brexit). But effects on the UK economy, particularly the building sector, could weigh on Polypipe’s business.
Polypipe’s share price has appreciated by 24% year to date
Source: Yahoo Finance
Despite weakness in some areas of the market, Polypipe demonstrated an ability to keep the numbers going up – that says good things about the robustness of its underlying business, and should offer some reassurances to investors who are worried about Brexit. The company said revenue for 2018 increased by 5.2% on a year on year basis, and pre-tax profit also rose from £55.6 million in 2017 to £58.2 million last year. These represent a new record for the company.
Speaking to the strength of these figures, CEO Martin Payne said: “We are delighted to report another record performance, despite a backdrop of challenging market conditions. Our second half of the year was strong, and we completed two significant acquisitions as part of our strategy to broaden our market offering. Both Manthorpe and Permavoid are performing in line with expectations and we look forward to further progress.”
“We continue to see strong cash generation, and the long-term growth drivers of legacy material substitution and legislative tailwinds, together with our strong balance sheet, position us well for the future.”
Dominion holds Polypipe in its Global Trends Managed Fund.
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