Kingspan sees European insulation markets weakening

City A.M. Reporter
Irish building supplies company Kingspan said a jump in profits in the first half of the year is unlikely to be sustained in the second half as the Eurozone crisis is dragging down activity in some markets.

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.