SIG’s FY25: profit up on tighter costs, flat sales, and a clearer plan
SIG plc has posted full year results for 2025 that show tougher markets, steady sales, and better profitability underneath the statutory noise. Like-for-like (LFL) sales – sales per working day, adjusted for openings/closures and currency – were flat, but underlying operating profit rose 28% to £32.1m as management stripped out costs and sharpened execution.
The statutory numbers are still loss-making due to impairments and restructuring, but the cash discipline improved and liquidity looks sound. The new CEO’s “Vision 2030” gives investors a clearer destination: a 3%-5% operating margin through the cycle and stronger cash generation.
Group performance snapshot
| Metric | FY25 | FY24 |
|---|---|---|
| Revenue | £2,591.0m | £2,611.8m |
| LFL sales growth | 0% | (4)% |
| Gross margin | 24.2% | 24.5% |
| Underlying operating profit | £32.1m | £25.1m |
| Underlying operating margin | 1.2% | 1.0% |
| Underlying loss before tax | £(20.0)m | £(14.3)m |
| Statutory loss before tax | £(61.7)m | £(44.8)m |
| Basic loss per share | (5.5)p | (4.2)p |
| Operating cash inflow | £43m | £4m |
| Free cash flow | £(12)m | £(38.6)m |
| Liquidity (cash + undrawn RCF) | £171m | £177m |
| Net debt | £518.2m | £497.3m |
| Leverage (net debt/underlying EBITDA) | 4.7x | 4.7x |
Why underlying profit rose when sales didn’t: £39m of year-on-year operating cost reductions from restructuring and productivity gains more than offset lower volumes and pricing pressure (management cites a net 1% price deflation for the year).
What stood out – the good, the bad, and why it matters
Positives I like
- Underlying operating profit up 28% to £32.1m despite soft demand and a 1% decline in reported revenue.
- UK Interiors turnaround: operating profit improved to £7.7m (2024: £0.6m) on LFL sales up 3%; the core Insulation & Drylining arm grew 5% LFL for the year.
- Benelux loss cut to £(1.3)m from £(4.5)m after closing seven branches and improving mix.
- Cash discipline: operating cash inflow of £42.7m and free cash outflow reduced to £12.0m, helped by a £28.5m working capital release.
- Robust liquidity of £171.3m and an undrawn £90m RCF; leverage flat at 4.7x.
Headwinds to keep in mind
- Statutory loss before tax widened to £(61.7)m, driven by £41.7m of “Other items” including £29.7m of non-cash impairments and £9.0m of restructuring costs.
- Gross margin dipped to 24.2% from 24.5%, reflecting tougher pricing in weak markets.
- Finance costs rose to £54.0m (2024: £43.7m) following the 2024 refinancing, keeping the group in an underlying pre-tax loss.
- No dividend for 2025; the Board will consider a return once earnings cover and conditions allow.
Segment deep-dive: where the progress is happening
- UK Interiors: revenue £673.1m (+1% reported, +3% LFL), operating profit £7.7m (2024: £0.6m). The Insulation and Drylining business grew 8% LFL in H1, 3% in H2, 5% for the year.
- UK Roofing: revenue £453.4m (+1% reported, +2% LFL), operating profit £14.3m (2024: £13.9m). Margin broadly stable.
- France Interiors: revenue £189.9m (LFL (6)%); operating profit £4.8m (2024: £6.2m). New-build softness hurt volumes and pricing.
- France Roofing: revenue £388.4m (LFL (5)%); operating profit £9.7m (2024: £8.0m), aided by lower opex and £3.0m property gains.
- Germany: revenue £432.5m (LFL (3)%); operating profit £1.3m (2024: £4.7m). Costs were kept in check but profits fell with the market.
- Poland: revenue £260.5m (+8% reported, +5% LFL); operating profit £4.0m (2024: £4.6m). Share gains offset weak markets but pricing and cost inflation squeezed profit.
- Benelux: revenue £91.6m (down on closures), LFL +2%; operating loss £(1.3)m (2024: £(4.5)m). Benefits from the self-help programme are coming through.
- Ireland: revenue £101.6m (LFL (3)%); operating profit £2.7m (2024: £3.3m). H2 demand deteriorated.
“Other items” and impairments – what’s underneath the statutory loss
Management separates “Other items” to show underlying performance. In 2025 these totalled £41.7m pre-tax and included:
- Impairments of £29.7m, mainly non-cash: £23.4m on goodwill/intangibles in Miers and other former UK Specialist Markets, and £6.3m on right-of-use assets in UK Interiors.
- Net restructuring costs of £9.0m (redundancy £2.8m and branch/property costs £6.2m, partly offset by £1.1m lease gains).
- Amortisation of acquired intangibles £2.1m and cloud ERP costs £1.3m.
Cash exceptional outflow tied to these items was £9.3m. The heavy lifting here is part of the portfolio clean-up and cost reset that should make later profit drops-through cleaner when demand recovers.
Cash, debt and funding: steady headroom, higher interest burden
Operating cash flow before exceptional cash items was £52.0m – a 162% conversion of underlying operating profit – thanks to tighter working capital. After interest (£51.2m) and tax (£3.5m), free cash outflow improved to £12.0m. Capex stayed modest at £16.0m.
Net debt closed at £518.2m, including £323.3m of lease liabilities. On the funding side, SIG has €300m 9.75% secured notes due October 2029 and €13.5m 5.25% notes due November 2026, plus a £90m RCF maturing April 2029 that was undrawn throughout 2025. Liquidity at year-end was £171.3m. Leverage remained 4.7x on the group’s definition.
Vision 2030 and the 2026 outlook
The strategy aims to build a best-in-class pan-European distribution platform with a 3%-5% operating margin through the cycle and stronger, more predictable cash generation. Near-term priorities are further cost/efficiency programmes and better procurement. With approximately £2.3bn of annual procurement spend, management targets an annualised benefit of at least 1% of spend from 2027 by applying best practice.
For 2026, SIG expects market softness to persist, with any recovery skewed to H2. Trading early in the year was also hit by poor weather, leaving LFL sales for the first two months weaker than expected. Even so, the group expects further financial and strategic progress in 2026 and to maintain healthy liquidity while continuing portfolio optimisation.
My take for investors
This is a credible “fix the base” year. Underlying profit moved up, UK Interiors was rehabilitated, and cash discipline improved. That matters because operating leverage in distribution can be powerful on the way back up – and SIG’s businesses generally outperformed local markets in 2025.
The flip side is clear: margins remain thin at 1.2%, finance costs are heavy at £54.0m, and leverage at 4.7x leaves little room for complacency if demand softens further. The statutory loss reflects the clean-up, but it also delays the return to dividends.
Overall, the direction of travel is positive, but patience is required. Delivery against the 2026 self-help plan and procurement savings, plus any sign of H2 demand stabilising, are the near-term markers that could change the narrative.
What to watch next
- Quarterly LFL trends, especially in the UK and Germany, after a weather-affected start to 2026.
- Further opex savings and procurement progress towards the “at least 1% of £2.3bn” annualised benefit from 2027.
- Portfolio actions following the closure of Mayplas and the UK Specialist Markets reorganisation.
- Leverage trajectory versus 4.7x and interest cash costs after the 2024 refinancing.
- Any commentary on timing for dividend restoration – currently “not prudent” and not disclosed.
If management keeps squeezing costs, defends margin, and nudges growth back into positive territory, the path to that 3%-5% operating margin looks achievable over time. For now, it is all about execution and cash.
