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Investing.com -- Kingspan Group Plc (IR:KSP) shares rose more than 7% on Monday after the Ireland-based building materials company maintained its full-year trading profit guidance and indicated it expects continued growth in 2026.
The company reaffirmed its fiscal 2025 trading profit target of around €950 million, broadly in line with Morgan Stanley’s estimate of €954 million and the Visible Alpha consensus of €948 million.
Kingspan said its markets remained mixed, with non-residential construction described as “stable” and residential activity “subdued.”
Chief Financial Officer said that, assuming stable market conditions, Kingspan expects to grow trading profit by €100 million year over year in 2026, with €30 million linked to acquisitions already completed. The CFO said the business is “feeling pretty good” about the outlook.
Group revenue grew 6% year over year in the third quarter, ahead of expectations for about 5% second-half growth. In its Building Envelope division, sales rose 7% in the first nine months and 6% in the third quarter.
The order book was up 5% at the end of September compared with a year earlier. Activity in Europe, including France, Germany, Central Europe and the United Kingdom, was described as solid, while the Americas trailed 2024 levels due to slower U.S. demand.
New roofing facilities in Oklahoma and Maryland remain on schedule for production in 2026, with a modest contribution expected that year and a more meaningful impact from 2027.
The Advanced Building Systems division recorded 10% year-over-year growth in the first nine months and 6% in the third quarter, below management expectations. Orders increased 23% from a year earlier as of September.
Kingspan said a “very significant level of enquiries” was coming in, driven by demand from data center projects that helped offset a weaker non-residential market.
The company said a new plant in Kentucky remains on track to begin operations in 2026, and it is considering further plants in Europe, Southeast Asia and Latin America.
Kingspan continues to explore a partial 25% initial public offering of the Advanced Building Systems unit on Euronext Amsterdam in the first quarter of 2026.
Morgan Stanley said the company’s guidance and early 2026 commentary “underpins consensus” expectations for next year, which currently stand at €1.042 billion in trading profit.
The brokerage projected 14% year-over-year profit growth for 2026, compared with a 10% consensus estimate.
Kingspan guided year-end net debt to be about €1.85 billion, with leverage of 1.5 to 1.6 times net debt to EBITDA. The company said mergers and acquisitions were the main factor behind the higher debt level.
Of the €650 million two-year share buyback program announced earlier, €93 million has been executed.