Construction products distributor SIG plc says rising demand along with cost inflation has benefited its sales and profits.
The Sheffield-based business, which operates across Europe, told investors it expects full year results to be "significantly ahead" of previous expectations as group sales for the quarter to March 31 were up 25% at £641m.
Inflation is estimated to have added about 19% to group growth over the period, with the impact varying according to SIG's operating companies which include SIG Insulation, SIG Interiors and SIG Benelux, as well as others.
Read more: Kitchen giant Howden drives revenues up almost 22 per cent in early 2022
The business said that growth included annualisation of input cost inflation experienced in the second half of 2021, as well as increases earlier this year as its suppliers passed on steep increases in manufacturing energy costs.
Cost inflation is expected to continue and SIG indicated that resulting revenue increases would offset any localised market softening. It said its underlying operating margin was set to reach 3% and that the group would be cash generative in 2022.
Chief executive Steve Francis said: "The first four months have seen markedly stronger growth than anticipated, driving positive margin momentum across all our countries of operation.
"Our decentralised model, with 433 branches in seven countries providing strong local specialist expertise and superior stock availability, continues to gain ground and to show resilience in market conditions that remain challenging.
"Demand for our sustainable construction offerings remain strong. The three acquisitions made during the last 18 months are performing well and this is an area of increasing strategic focus for us.
"Although it is relatively early in the year, and notwithstanding the current macro-economic and geo-political environment, the strength of our recent trading gives us the confidence that we will now reach our initial margin target of 3% and return to cash generation this year, ahead of schedule."
