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2019 in Review

“2019 was another year of solid growth for the business, ending a decade during which the company’s revenue increased fourfold, and trading profit increased sevenfold. Performance this year was helped by increased penetration of our proprietary high-performance insulation products QuadCore™ and Kooltherm®. This structural shift in building techniques and materials used also drove our increased profit margins.

Organic expansion is supported by new production facilities we have commissioned during the year in the US, Brazil and Sweden, and the level of demand building in Southeast Asia will soon justify investment in local manufacturing capacity there. We also continue to focus on acquisition opportunities, and have a healthy pipeline of targets under consideration.

The uncertain economic outlook in our end markets has seen a slow start to 2020, however, Kingspan’s longer-term growth potential is supported by investment in innovation to ensure we have a product suite that continues to differentiate us from the competition, operated through a sustainable business model that is underpinned by the ambitious Planet Passionate targets we set in 2019.”

Gene M. Murtagh, Chief Executive Officer, Kingspan Group PLC

2019 in a Nutshell

Products

65% Insulated Panels
19% Insulation Boards
7% Light & Air
5% Data & Flooring Technology
4% Water & Energy

Drivers

85% Energy Efficiency & Conversion
15% Other

Geography

53% Mainland Europe
21% Americas
19% United Kingdom
7% ROW

Sectors

70% Commercial & Industrial
18% Residential
12% Office & Data

End Market

80% New Build
20% Refurbishment

Channel

70% Direct
30% Via Distribution


Financial & Operational Highlights

+7%


€4.7bn

Revenue

+18%


€579.8m

EBITDA

+12%


€497.1m

Trading Profit*

17.3%


+50bps

ROCE

*Operating profit before amortisation of intangibles and non trading items

Financial Highlights
Operational Highlights
Five Year Financial Summary
  • Revenue up 7% to €4.7bn, (pre-currency, up 6%).
  • Trading profit up 12% to €497.1m, (pre-currency, up 10%).
  • Free cashflow up 9% to €337.1m.
  • Group trading margin of 10.7%, an increase of 50bps.
  • Basic EPS up 11% to 204.6 cent.
  • Final dividend per share of 33.5 cent. Total dividend for the year up 10.7% to 46.5 cent.
  • Year-end net debt1 of €633.2m (2018: €728.3m). Net debt1 to EBITDA1 of 1.1x (2018: 1.4x).
  • ROCE of 17.3% (2018: 16.8%).
  • Insulated Panels sales growth of 7%. Strong performance in the Americas. Mainland Europe performed well overall with the notable exception of Germany. Difficult UK market particularly in the second half. Further headway in key markets on QuadCoreTM, now 9% of global sales.
  • Insulation Boards sales growth of 2%. Continuing progress on Kooltherm® and share gain from traditional materials.
  • Strong underlying volume growth of 4% and 8% in Insulated Panels and Insulation Boards partially offset by the pricing impact of raw material deflation.
  • Light & Air sales growth of 12% buoyed by a strong performance in the US. Solid activity in Mainland Europe. Daylighting centre of excellence under construction in Ireland.
  • Water & Energy sales growth of 3% with progress in the Nordics, a difficult UK environment and more subdued rainwater harvesting activity in Australia.
  • Data & Flooring sales growth of 13% reflecting strong datacentre activity and geographic expansion in Europe.
KPIs 2019 2018 2017 2016 2015
Revenue 4,659.1 4,372.5 3,668.1 3,108.5 2,774.3
Trading Profit 497.1 445.2 377.5 340.9 255.9
Trading Margin 10.7% 10.2% 10.3% 11.0% 9.2%
Profit before Tax 454.4 404.9 346.5 314.0 232.0
Free Cash Flow 337.1 308.4 198.5 206.6 267.0
ROCE 17.3% 16.8% 17.8% 17.3% 15.2%
           
Balance Sheet 2019 2018 2017 2016 2015
Working Capital of Annualised Turnover as a % of Q4 Sales  11.9% 11.5% 13.0% 12.3% 10.9%
Total Shareholder's Equity 2,120.4 1,788.9 1,568.0 1,471.5 1,293.8
Net Debt 633.2 728.3 463.9 427.9 328.0
Net Debt as a % of Total Shareholder's Equity  29.8% 40.7% 29.6% 29.1% 25.4%
Net Debt / EBITDA 1.1 1.4 1.05 1.06 1.04
Current Assets / Current Liabilities 1.66 1.59 1.65 1.56 1.43
           
Per Share Data (in euros cent) 2019 2018 2017 2016 2015
Earnings (basic)  204.6 184.0 159.0 143.8 106.7
Dividend  46.5 42.0 37.0 33.5 25.0
Total Shareholder Return % 47.2% 3.8% 42.7% 7.4% 71.0%


Business Review

2019 capped off a decade of great progress for Kingspan with revenue and trading profit ahead of prior year by 7% and 12% respectively. Over the past decade, sales and trading profit grew in excess of fourfold and sevenfold respectively. Group sales reached almost €4.7bn, and trading profit €497m. Despite the significant macro instability in a number of our key markets the Group performed well in the first half, but was weaker towards year end. Predictably, the UK was the most notable illustration of this.

Underlying volume growth at the larger Insulated Panels and Insulation Boards divisions was 4% and 8% respectively. Underlying revenue was 1% ahead in Insulated Panels and 1% lower in Insulation Boards reflecting the impact of lower pricing due to raw material deflation over prior year.

During the year we invested a total of €305m continuing on our path of both organic and new acquisition expansion worldwide. New facilities were either completed or commenced in Sweden, UAE, USA, the Netherlands and Brazil. Acquisition investment was €144m, comprising most notably Bacacier in France for €122m.

Strategic Review

2019 marked the launch of our global Planet Passionate initiative, building upon the last decade of progress on our Net Zero Energy agenda. We have now embarked on our next ambitious 10- year journey to radically advance Kingspan across the four key themes of Energy, Carbon, Circularity and Water. This agenda is central to our purpose and entails the following targets and timelines:

Energy
Carbon
Circularity
Water
pexels-photo-421888
  • Maintain our Net Zero Energy status
  • Increase our direct use of renewable energy to 60% by 2030
  • Increase our on-site generation of renewable energy to 20% by 2030
  • Install solar PV systems on all wholly owned facilities by 2030
BIM_News
  • Net zero carbon manufacturing by 2030
  • 50% reduction in product CO2 intensity from our primary supply partners by 2030
  • 100% zero emission company funded cars by 2025
Kingspan_Planet Passionate_Web Spotlight Image 1
  • 1 billion PET bottles upcycled into our manufacturing processes by 2025
  • All QuadCoreTM insulation to utilise upcycled PET by 2025
  • Zero company waste to landfill by 2030
Kingspan Planet Passionate Ocean
  • 5 active ocean clean-up projects by 2025
  • 100 million litres of rainwater harvested by 2030

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