September 21, 2018 / 6:52 AM / 8 months ago

UPDATE 2-SIG seeing some signs of suppliers stockpiling -CEO

* H1 underlying profit falls 21.8 pct

* H1 profit hurt by icy winter in Britain

* SIG highly dependent on suppliers of raw material- CEO (Recasts with CEO comments)

By Noor Zainab Hussain and Samantha Machado

Sept 21 (Reuters) - Construction goods firm SIG Plc is seeing some signs of stockpiling by its UK suppliers ahead of Britain’s exit from the European Union, its chief executive said on Friday.

“We see when talking to our suppliers in the UK that there is a little bit of stockpiling going on of raw materials, not necessarily of finished products,” CEO Meinie Oldersma told Reuters.

“It is their (supplier’s) ability to make sure that they secure enough raw materials ...that is what our understanding is they are doing,” he said. A company spokesman declined to name the suppliers.

The UK government has already asked drugmakers to build an additional six weeks of medicines stockpiles to cope with potential supply disruption in the event of a no-Brexit deal.

Cadbury owner Mondelez International is also stockpiling ingredients, chocolates and biscuits in Britain to avoid interruptions to business in the event of a hard Brexit.


Earlier on Friday, SIG, which operates in the UK and across Europe, on Friday reported a 21.8 percent fall in first-half underlying pre-tax profit.

The supplier of insulation and roofing products said builders had delayed projects following a long, icy winter in Britain.

UK companies have also been unsettled by the prospect of Britain potentially crashing out of the EU next March without a trade deal.

“The first half did not provide the trading backdrop we wanted, with significant challenges in the UK market as a result of the poor weather in the early months of the year and continuing macro uncertainty,” Oldersma said in a statement.

SIG said underlying operating profit from Britain and Ireland fell to 14.2 million pounds ($18.74 million) from 23.7 million pounds a year earlier.

Shares in SIG, which maintained its full-year outlook, were 2.5 percent up at 124 pence at 1324 GMT, after falling as much as 4.7 percent earlier.

$1 = 0.7578 pounds Reporting by Noor Zainab Hussain and Samantha Machado in Bengaluru; Editing by Amrutha Gayathri and Emelia Sithole-Matarise

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