The business responded well to the unique challenges posed by COVID-19 and we continue to see good potential to outperform our markets and deliver sustainable growth in shareholder value.”Bob Lawson Chair
Our priority was to protect the business and ensure the safety of all our people, customers and suppliers by mandating COVID-safe working practices. We also secured our financial position and substantially completed major investments in new operating capacity. This good work leaves the business well-placed for the future.Download section in full
A vertically integrated model
To maximise efficiency
The coordination of our manufacturing, distribution processes and recycling activities, help us to be efficient throughout all stages of our value chain.Download section in full
Eurocell Building Plastics
of foam profile
of profile produced
31.1k tonnes1 of rigid profile
Owner managed businesses and contractors
Proportion of revenue in RMI market
Proportion of revenue in new build housing market
Proportion of revenue in public new build housing market
12.4k tonnes1 of recycled compound consumed (23% of profile raw material consumed)
Our Business ModelDownload section in full
We are a leading manufacturer of rigid and foam PVC profiles, composite and PVC entrance doors for the window and building home improvement sectors. Our manufacturing process uses raw materials including PVC resin and our own produced recycled material.
The Profiles division supplies our manufactured profile to a network of fabricators, who in turn supply end products to installers, retail outlets and house builders.
The Building Plastics division sells, through its network of branches, our manufactured foam products and entrance doors, along with a range of third-party related products, as well as windows fabricated by third parties using products manufactured by the Profiles division. Customers are mainly installers, small builders, roofing contractors and independent stockists.
We recycle both customer factory offcuts (‘post-industrial’ waste) and old windows that have been replaced with new (‘post-consumer’ waste). The recycled material is used to generate brand new extruded plastic products.
Vertically integrated model
The coordination of our procurement, manufacturing and distribution processes enables us to capture margin throughout all stages of our value chain.
Our recycling activities help lower material costs and improve product stability.
We operate well-invested and modern extrusion facilities.
We are the UK's largest window recycler.
Our extensive branch network is a driver of sales growth and market share. It also helps improve manufacturing efficiency, with pull-through demand driving higher factory utilisation.
We are committed to a strategy of continually developing new and existing products.
We support the use of Building Information Modelling (‘BIM’) software, giving architects and contractors access to a library of Eurocell products, making it easier to specify them.
We have a strong brand image and our marketing activities seek to maximise our brand awareness.
People and culture
Our experienced management team have a proven track record of achieving growth.
Our corporate culture is one of openness, trust, encouragement and clarity of purpose. We train and empower our people to help our customers grow their businesses.
Our branches are conveniently located and have readily available inventory, thereby providing excellent service to local customers and national groups alike.
We also strive to help our customers through the provision of technical, business development and marketing support services.
Our initiatives to support sales and deliver high levels of customer service differentiate Eurocell from our competitors. We expect this to drive good sales growth.
We have a track record of solid profitability. We experienced some challenges with incremental volume in 2018/19, but our continued investment in expanding capacity and improving operational efficiency, coupled with strong sales growth, should drive increased returns.
Expanding the branch network (including larger format branches), whilst dilutive until new branches become established, should deliver healthy medium-term results as new branches mature.
Increased use of recycled materials can help mitigate raw material pricing pressure.
Good cash generation
Our operating cash flow conversion is good, particularly in Building Plastics, where a high proportion of customers pay at point of sale or shortly thereafter. This has allowed us to invest in working capital to support sales growth and protect the business from any raw material supply interruption that may take place.
Good return on sales
Our strong brand, well-invested facilities and capital-light branch expansion programme deliver a good return on sales.
Progressive returns to shareholders
Our dividend policy, supported by sales growth and cash generation, deliver progressive dividend returns to shareholders.
Our overall strategic objective is to deliver sustainable growth in shareholder value.
We work hard to train and develop our people, and provide rewards commensurate with our goal to be an employer of choice.
Through high-quality products and a strong focus on customer service, we have developed a very loyal customer base.
Small builders & installers
The independent sole traders that visit our branches benefit from the one-stop shop offering we provide.
House builders appreciate the quality of our products and benefit from Eurocell coordinating our fabricators’ offering to meet their requirements.
We aim to make our products as easy as possible to work with, which is very attractive to our direct or indirect installer base.
We have seven key strategic priorities
Our overall objective is to deliver sustainable growth in shareholder value by increasing sales and profits at above market growth rates through leadership in products, operations, sales, marketing and distribution.
Our key strategic priorities have evolved in-line with business needs:
We have seven key strategic prioritiesDownload section in full
Target growth in market share
Increase market share of rigid PVC profiles to drive sales and profit growth in Profiles.
Expand our branch network
Investment in existing estate and new branches to increase market share of foam PVC profiles, and drive sales and profit growth in Building Plastics.
Increase the use of recycled materials
Increased use of recycled material to help mitigate raw material pricing pressure, as well as enhance the stability and reduce the carbon footprint of our manufactured products.
Develop innovative new products
Maintain market leadership by offering the latest in product innovation.
Explore potential bolt-on acquisitions
Consider acquisition opportunities when they arise.
Deliver sustained operational excellence
Optimise returns on recent investment in manufacturing and warehousing capacity to enhance profits and return on sales.
Develop a sector-leading digital proposition
Develop end-to-end digital solutions to enable our strategic priorities and improve the supplier, customer and employee experience.
Our Strategy in action
Through 2016-19, the success of our commercial strategies resulted in a strong compound annual growth rate in sales of 12%. However, profits for that period were impacted by sales running substantially ahead of our expectations, thereby exceeding the available operating capacity and leading to inefficiencies and extra costs.
However, manufacturing and warehousing constraints have now been resolved through major investments in new capacityDownload section in full
In Operations, we have been focused on improving our execution and on preparing the business for growth.”Mark Hemming Chief Operating Officer
In Operations, we have been focused on improving our execution and on preparing the business for growth.”