Shares in Stirling-based Superglass Holdings plunged by almost half ...

Tag : insulation

In a pre-close update directors said they expected that profit forthe year ended August 31 would be in line with current marketexpectations.
Investors appear to have taken fright at the additional comment:"Going forward, economic conditions are more uncertain, and thedirectors have budgeted for the new financial year with somerequisite caution. At this time the directors cannot be certainthat current market expectations for the year ending August 31,2009, will be achieved."
This may have led some to conclude that Superglass was being hithard by the slump in the new-build market.
However, while this market has been hammered, Smellie noted it onlyaccounted for between 15% and 25% of Superglass's business.
The vast bulk of output is used to "retrofit" insulation inexisting homes. This market that has been affected by someuncertainty regarding the impact of the government's CarbonEmissions Reduction Target scheme.
However, as Prime Minister Gordon Brown recently won backing fromutilities to increase spending on the scheme, volumes in thismarket could increase substantially over the next two years.
Smellie noted that Superglass had been cutting costs throughoutthis year and would not be making any staff redundant.
House broker Brewin Dolphin left its forecast for pre-tax profitsin the year to August 31 unchanged at £7.5m. It reduced itsforecast for the current year from £8.9m to £6m.
The broker insisted shares in Superglass had been oversoldyesterday, when they fell 30.25p to 33.75p.
That gave the company a market capitalisation of £20m.
Smellie appeared exasperated, telling The Herald the movement lefthim feeling "disillusioned".
"Any person looking at the state of the country should not havebeen too shocked at that (update)," he said.
"It appears that if you put out any bit of bad news you getslaughtered. The City's far too sensitive. There's virtually nocompany in the country that does not have some problems just now.They do not seem to be able to control themselves."
The share price could prompt soul-searching by Smellie, who has wonbacking from a series of private equity firms for his efforts todevelop the company.
Asked if he might try to take Superglass private, he said:"Everything is possible, but we have not considered that at all."