Gavin Slark, Group Chief Executive
Five Reasons to Invest
1. Resilient revenue
Demand for our products is primarily driven by repair and maintenance ('R & M') activity, much of which is considered essential. In particular, boiler and radiator markets and associated products, which account for a large proportion of our sales, remain robust. This non-discretionary spend in the heating market has proven to be resilient throughout the recession.
2. Underlying demand for our product increasing
We anticipate that underlying demand for product used to repair, maintain and improve existing facilities will increase driven by UK population growth and increased population density. The need to maintain existing facilities and an increased requirement for new homes which underpin revenue growth.
3. Price inelasticity
Our products are required to undertake essential repair and maintenance. We recognise the influence of competitive market conditions and remaining price competitive but the underlying demand for our product is primarily price inelastic.
4. A robust business model
Our trade customers have a need for what we do and this need will remain. We add value through: consolidation of product; delivery to point of use; adapting our offer to meet customer need; providing availability; product knowledge and through leveraging procurement and sourcing. The business model underpinning our trade remains robust.
5. New revenue streams
We are growing revenue in segments of the market where we have minimal penetration and where the growth dynamics are strong. These markets include: spares, renewables, drainage and meeting the needs of the water industry.
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