Wednesday 21 February 2018

Kingspan's Murtagh downplays Brexit risk

Kingspan CEO Gene Murtagh. Photo: Gerry Mooney
Kingspan CEO Gene Murtagh. Photo: Gerry Mooney
John Mulligan

John Mulligan

Insulation giant Kingspan will seek to maximise its business in the UK, regardless of whether voters there decide to leave the European Union in June's referendum, according to chief executive Gene Murtagh.

Cavan-based Kingspan generates 30pc of its business in the UK, with the group yesterday reporting record revenue of €2.77bn for 2015.

"It's significant for us one way or the other," Mr Murtagh told the Irish Independent. "Whether a Brexit is negative or positive, to be quite honest I don't know.

"If the UK does opt out, and my own view is that it won't eventually do that, it will do it for what it believes are the right reasons. If on that basis, the UK market and economy becomes stronger, that's clearly a positive for Kingspan."

However, asked if he would like to see the UK remain in or leave the EU, Mr Murtagh said that on balance, he would prefer "more of the same".

The chief executive also indicated he'd be reluctant to see the Government or the Central Bank intervene to spur home building in Ireland, despite home construction failing by a wide margin to meet demand.

"I don't think it's any harm if Ireland gradually gets back on its feet rather than getting back with a bang (in relation to housing)," he said.

"I know there's more demand there than supply, but I think piece by piece the market will recover.

"The industry was demolished seven or eight years ago and it's impractical to think that you can simply return there in terms of capability and infrastructure, but it will get there gradually."

Mr Murtagh was speaking as Kingspan reported a record set of results, boosted by acquisitions, currency tailwinds and a generally improved environment in the UK.

Its revenue of €2.77bn was 47pc higher year-on-year, while the group's trading profit jumped 72pc to €256m. The results were better than expected by analysts. Kingspan's full-year dividend also rose 54pc in respect of 2015. Excluding currency gains, revenue was 38pc higher, while trading profit was up 58pc on the same basis.

Kingspan completed two major acquisitions last year - the building products unit of Canadian firm Vicwest, for €139m, and the €320m purchase of Belgium's Joris Ide, its largest ever acquisition.

Mr Murtagh said the group has the firepower to spend up to €500m this year on acquisitions, but said it might equally spend nothing.

He said many potential sellers had unrealistic expectations for the value of their businesses.

Irish Independent

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