SIG sales rise as European construction markets pick up

Nov 14 (Reuters) - Building materials supplier SIG Plc said like-for-like sales rose 2 percent in the four months to October, helped by improvements in the European construction market.

The British company, which supplies materials for roofs, insulation products and interior fittings, also said it was on track to meet its full-year expectations.

The company will benefit from the liquidation of an unnamed major rival in Benelux as well as the strong economic prospects in Poland, Chief Executive Stuart Mitchell said.

The company said like-for-like sales in mainland Europe inched up 0.5 percent in the four months to October as its businesses in Poland and Benelux did well.

Mitchell said he believed Saint-Gobain, Europe's biggest supplier of building materials, and British plumbing supplies group Wolseley (Berlin: 24W1.BE - news) were exiting Poland.

"So I think we're kind of seeing the early start of last man standing in Poland and we'll benefit from that," Mitchell said on a conference call with analysts.

Poland and Benelux together accounted for about 11 percent of SIG (LSE: SHI.L - news) 's revenue in 2012. The company operates in mainland Europe, UK and Ireland (Other OTC: IRLD - news) .

SIG said its margins in Europe were a little higher than in UK, but there was a possibility to raise prices in the UK.

Sales rose in France, its second biggest market, but fell slightly in Germany.

The company said sales in UK and Ireland, which account for a little less than half of its revenue, rose 3 percent.

SIG's full-year gross margins are expected to rise about 10 basis points, Finance Director Doug Robertson said on the call.

Shares in the South Yorkshire-headquartered company were up 3.1 percent at 211.54 pence at 1138 GMT on the London Stock Exchange.