Kingspan Grp Ord

Hello and welcome everyone to the Kingspan Preliminary Results 2025. My name is Becky and I will be the operator today. All lines will be muted throughout the presentation portion of the call with a chance for Q&A at the end. If you wish to ask a question in this time, please press start followed by one on your telephone keypads. I will now hand over to your host, Jean Mata, CEO, to begin. Please go ahead.

Excellent. Good morning. Thank you and welcome everybody. I'm joined here by Jeff and Dave to take you through our 2025 results. If you could please just go to slide three in the results deck titled 25 in summary. And just in brief, we saw revenue growth to 9.2 billion euro, which was Pre-currency growth of 9%. On the EBITDA, we were just over 1.2 billion, which similarly was 9 up. And trading profits was just over 955 million. And again, like for Lycra, our pre-currency growth of 8%, which brought our EPS to 370 cents. And once again, on our continued emission reductions program right across the group, we've seen since 2020, a scope one and two internal reductions of 70%, which is pretty extraordinary. And that continues to advance along the lines that we've discussed previously. Backing up those results clearly and exiting the year, the insulated panel order bank as part of the envelope was ahead 8%, and actually the intake in the same product group is ahead 8% for the first six weeks of this year. And in the advanced business units, the revenue was up 12% in the year, which obviously accelerated through the second half. The backlog at the end of the year was ahead 24% in that whole product group. And the order intake in the advanced product sets is double prior year in the first six weeks. And we expect that growth rate to actually accelerate from this point forward. So all in all, it was a strong year given the circumstances. We entered this year with, I would say, very encouraging backlogs and activity right across the business. And notwithstanding the weather at the start of the year, which won't surprise anybody, we do expect to see significant growth in 2026. So just for some more colour and all that, I'd hand you over to Geoff now.

Thank you, Gene. I'm on page six, the financial highlights. Firstly, group revenue. or 9% at constant exchange rates. The principal FX move year on year was US dollar to Euro. To be specific on that, the average translation rate from Euro to US dollar was 1.08 in 2024 versus 1.13 in 2025 in terms of our average translation rate. Group EBITDA, 1.22 billion, up 7%. Trading profit, 9.55%. up 5% or 8% at constant exchange rates. Earnings per share at 3.70. Our total dividend for the year, 55.5 cent, a payout ratio of 15%, which is our policy guide. Strong free cash flow of 429 million, and I'll come to the components of that shortly. Trading margin at a headline down 10 basis points, 10.4%, but actually underlying earnings Pre-acquisition, we were actually ahead by 20 basis points to 10.7% year-on-year. Net debt, we ended the year 1.88 billion. And in terms of leverage, net debt to EBITDA of 1.65 times. Turning to page seven, just bridging revenue and trading profit year-on-year, our 2024 revenue is about 8.6 billion. Care DB, The significant component of sales growth during the year was the 707 million contributed by acquisitions year over year. And then we had the FX move of 2% or so, clipping sales by 138 million. From a profit perspective, 2024 was 906.7. Currency shaved 21.4 million off that. It's worth highlighting that. 19.6 million of that occurred in the second half of the year because that's really when the pronounced exchange rate move actually happened. Acquisitions contributed 49.5 million in the year, initially dilutive but will kick on from here in terms of trading margin and underlying profitability up by 20 million. The geographic profile of sales set out on page 8, pretty consistent year on year. The Americas at 22% of the business, the rest of the world at 8% and Europe all told across all territories, 70% of the business in both 24 and 25. Turning to free cash flow on page 9, naturally the strongest component of free cash is the EBITDA of 1.22 billion. Working capital, an outflow of 151 million. Our working capital to sales ratio is 11.9%, which on a five-year view is an efficient performance. It happened to be up by 50 basis points on the very low level of December 24th. and about half that move reflects the timing of acquisitions versus year-end. CapEx, £325 million. We're guiding £350 million for this current year. The other significant cash flow item, tax, of £132.8 million, in line with our income statement charge, with an effective tax rate of 16% in December. in 2025, and our guidance for 2026 is an effective tax rate of 16.5%. So all of that combined to give us a free cash flow of 429 million. From a capital perspective, that's set out on page 10 in terms of the reconciliation of opening and closing net debt. We reduced debt by the free cash. We deployed 258 million in acquisitions. and incurred 168 million in deferred consideration. We also acquired 2.2 million shares during the year for a consideration of 148.6 million. That's an average share price of 67.58. Dividends paid of 99.5 million during the year. So net debt end of the year, 1.88 billion. A feature of the business for a long period of time has been the strength of our balance sheet. Some commentary around that on page 11. The group has significant liquidity. The principal strands of that are our undrawn €800 million green revolving credit facility, which is fully committed to May 2028. We have cash balances on hand of approximately €600 million. Our total gross debt... It's about 2.2 billion or so between private placement and public placement. And the weighted average maturity of all of our drawn debt is a little over four years, and we have no significant maturities in the current financial year. So with that, I will hand back to Jim. Thank you, Geoff.

So just to... you know, look at the structural growth drivers of the business. Once again, you know, a lot of you will be familiar with this, but just in summary, if we can go to slide 14, which is multifaceted growth drivers for the insulated envelope. And again, we'll go through this in some more detail with Dave shortly, but the three primary strands here are growth and penetration, which continues even in European markets, not to mention North America, APAC, and South America. with very significant runway for us there into the long term. The continued geographic rollout of the business continues, again, I would stress, even in Europe and all of the other regions that we've just mentioned. And the product portfolio within the envelope is expanding way beyond what it was five, ten years ago. Obviously, huge growth in the quad core business, but expansion into other technologies like wood fiber, and the acoustic insulation sector, stone wall, not to mention, obviously, the roofing expansion, which is going on worldwide, and most significantly in North America, where we have very large ambitions for our business there. And I'd say, similarly, on slide 20, which is the growth drivers for advances, and this clearly is quite extraordinary and won't come as a surprise to anybody, but the sector itself, we're operating is demonstrating very strong double-digit growth in itself, which naturally we're in the middle of. The business is growing share as we go along as well. So just market share growth as we expand our product portfolio is a significant driver for us. And then the share of wallets is just way beyond what it was even five years ago, where per megawatt, we had exposure of about $100,000 per make, and that is now 5x that and growing. As we've expanded the product portfolio, got into water cooling, and now obviously into air handling, that continues to grow. And that spread of business and share of wallet, we expect to continue to expand significantly into the future.

Thanks, Gene. If I could take you all to slide 16 now, please. I think just as we enter a period where the macro backdrop looks like it's a little more stable than it's been for some time, it's probably worth reflecting on the markets that we've faced over the last five to six years. And what the slide is showing you is a very challenged backdrop, particularly across Europe, compared to 2019 on a volume basis, which if you look at the total footprint of the Kingspan markets, It looks like volumes in our addressable market down between 4% and 5% globally when we compare that to 2019. And over the same period, organically, insulated panel volumes have grown by nearly 14%. So it's been a very consistent 3% outperformance, which will become more evident as markets stabilize, but the conversion to more energy-efficient products has never been stronger. If I can bring you on then to slide 23, look, you've seen our global expansion map before, and really in taking advantage of all of the opportunities that Jean has outlined across the data business, the roofing opportunity that we have started in Europe and are embarking upon in North America, alongside the structural growth of the vast array of our products, you can see the investments we're making across the globe now and over the next two to three years to unlock all of that potential. So we look to have projects in the pipeline that will require investment of about 1.2 billion, which is nothing out of the ordinary in terms of capital allocation, but it's a potential to unlock about 2 billion of revenue over the fullness of time, which again, if you flip on to slide 24, will underpin that consistent long-term growth story that you've been familiar with with Kingspan. With that, I hand it over to Gene.

Thank you, Dave. So just on slide 25, which is the outlook and how we're feeling about the near-term future, as we said earlier, we've entered the year with very strong backlogs right across the business. They have continued to grow significantly through the first six weeks, although clearly dispatches and deliveries have been hampered somewhat by weather, but we expect that to recover pretty swiftly through March, April, and beyond that. And really just when we step back, the business clearly has grown consistently over the last forever. We reached our target for 2025. We expect growth of in or around 10% in earnings for the current year. And we would expect that rate of growth to accelerate beyond that into 2027 and 2028. Difficult to be specific about that, but we're certainly seeing a pipe of longer term activity and engagement that would give us a high degree of confidence to deliver what we've just expressed there now. So with that, we would be delighted to take your questions.

Thank you. If you wish to ask a question, please press star followed by one on your telephone keypads now. If you feel your question has been answered or for any reason you would like to remove yourself from the queue, please press start followed by two. We do ask today that you limit yourself to two questions per person. When preparing to ask your question, please ensure your device is unmuted locally. Our first question comes from Shane Carberry from Goodbody. Your line is now open. Please go ahead.

Morning all and thank you for taking my two questions. The first one, maybe just to follow up on that last point you were making, Jean, about the kind of level of growth over the kind of medium term or out to the end of the decade. Can you just give us a little bit more colour on exactly what you mean in terms of that trading profit growth exceeding what we've seen over the last couple of years to be helpful? And then the second is just thinking about the product evolution from a data perspective and how you kind of keep a pace with all the change that's happening in the industry. And are you still confident in terms of achieving a kind of 600 million EBITDA number kind of over the next four to five years?

Okay. Morning, Shane. So on the first point, like we really have multi-stranded growth across the business. And it's... it's actually very, very exciting, very encouraging. But if you look at our envelope for a start, like we've clearly got the evidence through the backlog and order intake in the insulated panel product strand, and obviously our entry into roofing, which has been both acquired and now increasingly organic, predominantly in North America, which really just hasn't kicked in at all. That's something for, you know, the second half of this year and into 2027 and beyond. And that's going to be significant and, as I say, clearly not evident just yet. We've got another dimension which is happening and I think it's going to be significant and here to stay for some time, which is inflation. So there are all kinds of trade barriers coming up left, right and centre. The result of that is that our big inputs like steel and chemicals are going to be subject to significant inflation in the current year. It's happening and we see it happening consistently quarter by quarter. into the future. And as odd as that sounds, that actually is a very positive dynamic for the group once you get past the lag phase. And that's going to be, I think, more and more materially evident as we go through even 2026. And then beyond that, which affects both advances and the envelope business, is just this truly seismic transition that's going on in the tech sector. and in particular around the move towards AI. As a group, we are positioned right at the core of all that, and that's both internal and external. And when you just piece all that together and you consider the level of tangible engagement we've got with our client base, which is now much more long-term because of the nature of these projects, the pipeline we're looking at is... is actually just really extraordinary. On the product evolution piece, we've obviously been able to keep at or above the pace of that, you know, moving from what was just a simple access floor, which was giving us exposure today to going back 20, 25 years, in fact. Like now the product portfolio is just not comparable to that, and it continues to expand. So, like, In terms of us being able to keep a pace of that, all I can say is the evidence of the past is that we have been able to do that. We're able to pivot and move with whatever the technology and the solutions have been going all along. And I'd be extremely confident that we continue to be at the forefront of that with our clients. And confidence around the $600 million EBITDA, yes, we'd be at least as confident. on delivering that as when we kind of mentioned it three or four months ago. And that's obviously whatever kind of four or five-year target. But the trajectory towards that is very, very evident.

Really helpful. Thanks, Gene.

Thank you. Our next question comes from Sida Ekblom from Morgan Stanley. Your line is now open. Please go ahead.

Thanks very much, gentlemen. I've got two questions, one quite simple one. On your free cash flow, you had quite a big swing in working capital in 2025. I wonder if you could just give us a little bit of commentary around the working capital investment there. Is that simply associated with new plants or is there something else that we need to think about there and then how we think about that sort of working capital development into 2026? And then secondly, on your roofing portfolio, can you talk a little bit about your decision to invest beyond these two initial assets? I believe that recently the commentary was around making a third investment in residential roofing. It would be good to just hear how you're thinking about that cadence. And then beyond maybe the next two years or so, can you talk to us about what your ambition is in the US roofing space? You're a new entrant. There's a lot of concern around disruption to pricing, etc. And I'd just like to hear how you would like your business to be positioned towards the end of the decade. Thank you.

Cedar, just to take the free cash flow question first. Over time, a highly efficient measure for us is a working capital sales ratio less than 12%. And that's been the measure of efficiency over time. At the end of 2024, it was 11.4%, which was particularly low and particularly efficient for a number of reasons. It was 50 basis points higher at the end of December 2025 to 11.9%. That's our assumption as we go into 2026 in terms of average working capital levels. It can vary for a whole number of reasons to within 50 or 60 basis points, but specifically about half the move during 2025 was associated with the timing of acquisitions and the working capital move between the date of acquisition to year end. So that'll naturally normalize as we move through 2026.

And then, Siddharth, on the roofing side, we've got the first two, as you mentioned, Oklahoma and Maryland, they're happening as planned. On the commercial roofing side, we'll be moving to a third facility as well in the not too distant future, more than likely in Utah. So that's going to give us really an ability to service the market pretty much nationally. And as you mentioned there, our intended entry into the resi side, that's kind of always been on our radar. It won't surprise you to know that we've been looking at acquisition opportunities on that side as well. It's a huge market. There are tens and tens of facilities around the country, and us entering with one will hardly even be noticed. But obviously, we've got to step into it at some point. That clearly, just by the nature of the size of the project, is more long-term, more like a three-year project. And as you know, that side of the roofing market is pretty challenged at the present time. But that's just a moment in time. So we just see it as part of the wider roofing portfolio longer term. How we'll be received or what our success rate will be, that's all TPC, but we haven't failed yet. In terms of disruption, market pricing, it's not something I'd be particularly concerned about. It's a huge market, it's a growing market on the commercial side. We would expect that certainly in the earlier years that our capacity additions will be readily absorbed by the general pace of growth in the market. And our previously stated ambition of getting to a 15% share of the addressable side, bearing in mind we don't want any presence in the EPDM market or the bitumen market. That remains our ambition, and we have every confidence of succeeding again there.

Thanks very much for the teller.

Thanks again.

Thank you. Our next question comes from Floor O'Donoghue from Davie. Your line is now open. Please go ahead.

Thank you. Good morning, everyone. I have a couple of questions. I might just ask in advance, first of all, Just in terms of the order book, how much visibility that gives you when you talk about it being the intake levels doubling and just generally the conversion of an order book. Is there a long time lag? Just the kind of dynamics of how that works. And then the second one I might ask is just you mentioned in the document about the board's business in Europe in terms of capacity management and actions you've been taking. Just a little bit more color on that would be very much appreciated. Thank you.

Yeah. So just on the advances backlog floor, it's approximately nine months, but it's actually becoming even longer. So it's getting larger and longer, and then we would have very solid engagement of work right through 27 and even into 28. Now, that's obviously not – they're not purchase orders, and so not entirely bankable, but on the basis of the type of engagement we've had with these end clients going back, we'd have a fair degree of comfort in that work coming through. And none of that would come as a surprise when you look at the general scale of investment into AI. It's only a tiny little bit around the age that we're after. And in terms of the board capacity, it's obviously not a huge part of the group any longer. It's become overpopulated. to be frank, particularly in Europe, largely grant-aided by Brussels, which is completely daft, but that's the situation we've got. So it's become unattractive in many markets. We have invested in probably the finest plants in the world, in Winterswijk in the Netherlands, huge capacity, and what we're on course to do is to really kind of gear up on that facility and get out of lesser-performing, more niche markets manufacturing plants around. So Finland, we've exited. Sweden, we're in the process of, we have a facility in France that we're not starting up and we're likely to take out a commission and other facilities somewhere in the middle of Europe. And like I say, we just gear up on one core plant in the Netherlands and just make that work hard. But importantly, we're going to be repurposing this capacity. It's not going in the bin or going to be growing cobwebs. So at least two of those lines I've just mentioned are going to be – one of them is brand new in Rion, France. Like I said, it's not wise to start it up. It's going to be going into the roofing sphere in the U.S. And one other of the European facilities is likely to be Utah-destined as well. So we just see a better future for those assets in that market, and that's kind of what we're about doing.

Thank you for that. Thank you very much.

Thank you. Our next question comes from Arnold Lehman from Bank of America. Your line is now open. Please go ahead.

Thank you very much. Good morning, gentlemen. A couple of questions on my side. Firstly, on advances, obviously you decided not to IPO the business. Can you confirm that this is now a closed ID and that you're going to keep 100% of advances and obviously keep the full consolidation of this high-growth business? And secondly, just to follow up on U.S. roofing, as you know, there's been a decent amount of consolidation and M&A activity in the distribution side of it. Is that an opportunity for you in terms of the new owners of these assets are maybe more open-minded to take on your products, or does that create new challenges? Thank you.

Great. So, Arnaud, yeah, the advanced IPO idea is put to bed. That's it. We're retaining 100% and moving on. That is that. It was a fantastic exercise, very interesting for us as well. But that's where we've ended up. In terms of the U.S. roofing, yes, there's an awful lot of moving parts on the distribution side, which, to be honest, it's neither positive nor negative for us because we're starting from zero. So it's opportunity one way or the other is the way I'd characterize that, bearing in mind, by the way, that we're obviously, through our insulated panel business, a direct to market model. So our relationships are with specifiers and delivering direct to site and invoicing contractors is our primary presence in North America. So we're going to be multi-stranded in terms of how we approach the market, which we're already doing. So distribution we see as A route as opposed to B route. And, you know, it'll take us a while to find our feet, but we have a blank page and we're looking forward to it. Very clear.

Thank you so much.

Thank you. Thank you. Our next question comes from Elodie Rule from JP Morgan. Your line is now open. Please go ahead. Oh, hi.

Thanks for taking my question. My first question is actually going back on Q4. If you could get us maybe a bit more color on the organic growth for both businesses, price, volume, that would be helpful. And my second question is, going back on U.S. roofing, on 26 guidance, what do you have with regard to that part of your business, and how should we model startup costs as the plants are ramping up, please? Thank you.

Thanks, Elodie. I'll take those questions. Firstly, as it relates to Q4, as we've said before, our business ought to be judged over a 12-month period. You get ebbs and flows through various months and quarters. We guided in November that we would do approximately $950 million in trading profit, and we came in at $955. I think it would be fair to say as well that our in Q4 was strong both within envelopes and advances such that we ended the year on the panels dimension to envelopes with the backlog 8% ahead so that did build through Q4 and as we've highlighted previously the intake in advances was strong as well both in Q4 and beyond that as regards the components year on the 1050. Since we gave the guidance of 1050 in November, the FX headwind has become steeper. Weather has been more acute in the early part of the year. Notwithstanding both of those factors, we still have a lot of conviction around the 1050, given the momentum in the business. Specifically within that, there's about 30 million of scope in terms They're the constituents of that.

Thank you. Our next question comes from Yassine Touhari from Unfilled Investment Research. Your line is now open. Please go ahead.

Good morning. Thank you very much for taking my question. The main question I would have is that what kind of sequence of organic growth do you see throughout 2026? I think the organic growth was very slow in 2025 in H1 and H2. I understand that the first quarter will be a little bit slow as well. Do you see an acceleration for the rest of the year? And it would be great if you could give us a little bit of more color on the elements of the growth in trading profit. What is scope? What is organic? What is FX?

Yeah, just to deal with the last part of your question first, the scope is about $30 million in terms of acquisitions that we've already made and annualizing that through 2026. of that is in the first half because if Shane the euro dollar rate really moved in a pronounced way from the second quarter so much of that is the first half as we've highlighted Q1 is likely to be soft enough in the early part due to weather but we given the backlogs that we have we see momentum picking up considerably from March onward And it's always difficult for us to kind of trend things from quarter to quarter. But over the course of the year, we're absolutely poised for decent growth.

Thank you. Thanks, Christine.

Thank you. Our next question comes from Poojani Ghosh from Bernstein. Your line is now open. Please go ahead.

Hi, and thanks for taking my questions. So going back to the roofing in the US, so could you talk about the progress on the build out of the plan? And you just highlighted that potentially the contribution to the P&L in 2026 is not that material, but then how should we expect that to progress in 2027? And also, you know, regarding your approach to commercial roofing, you know, going greenfield and then potentially considering M&A for residential roofing that you just talked about, what is the difference that you see in the market which informs the difference in the way you're considering entering the market in these two sides of roofings? And my second question is a little bit broader. Could you talk about your exposure to open AI and any potential opportunities or headwinds you see in the medium to long term?

Hi, Pooja Rini. Thanks for the question. Just on roofing first, to be clear, we're leading up with an organic investment. We've said we're keeping our options open with regard to potential M&A investments. But at the moment, you know, the investments in Oklahoma and Maryland are organic investments. Similarly, on commercial, when we move towards the West Coast, that will be organic as well. And as we appraise and go after the shingles market, you know, that's, again, an organic investment. None of that precludes M&A, but we are leading out with organic for the time being.

Yeah. Like, and as regards the broader question of exposure to open AI. I guess AI, never mind open AI, just AI itself. What's going on is, there's no other word for it except extraordinary. And yes, our exposure to it is extremely significant. And honestly, we've seen exciting times in the past and growth in Kingspan, obviously over the years. But in terms of what we're looking at for the next number of years, like you can see way beyond. We're kind of looking at activity levels just way beyond growth levels that we've ever experienced in the past. So our exposure to it is, yeah, very significant.

And the roofing profit contribution in 2027, if you have any indication?

Yeah, I mean, we should see sales activity from the end of this year in roofing, and we'll ramp up through 2027. Trading margins in roofing would still be single digits in 2027, but building out to group average rates into 2028 and beyond, and that's assumed in our forward guidance. You know, at this stage, we would expect sales in the US in roofing to be somewhere in the region of $150 to $200 million in 2027 and building out to $300 million in 2028. That's great.

Thank you.

Thanks for joining.

Thank you. Our next question comes from Julian Radlinger from UBS. Your line is now open. Please go ahead.

Yeah, thanks. Thanks very much, guys, too, from me. Hey, morning. So, first of all, the stronger or the very strong order intake in advances year to date, that's obviously similar to what we've seen from many other data center exposed plays. I suppose, why might that not lead to upside to the EBITDA guide for advances for 300 million that you gave a few months ago? Is that because you're basically sold out for 2026 already and that order Intake translates more to 2027 or what are the moving parts here? And then second question on inflation. So you called this out explicitly. Is that more steel or MDI that you're seeing? Just because I'm looking at MDI prices, they were actually, I think they're actually down year to date in the US. So is it more about steel here? Thank you.

Okay, Julian. So yeah, just on the advances EBITDA. So like that's progressed. If you say, if you go 24, 25, 26, And it's largely organic. It's kind of 180, 230, 300. So that's obviously pretty lively. So I guess in all of that, you know, we were indicating that it was going to grow significantly. And I think that's kind of – that qualifies as significant. But, you know, we're not going to hold the business back. And the 300 number for this year would be a minimum. actually to be honest. So let's see how that progresses. And then in terms of the other point was, oh yeah, inflation. So steel by far and away, like it's multiples of size and impact versus chemicals, not just MDI. So we do see it as being predominantly steel. It's largely as a result of protective measures all over the place. and it's starting to kind of jump ahead now. MDI, whatever MDI is doing in the U.S., just spot, I wouldn't be particularly, like for a start, our consumption in the U.S. would be tiny by comparison to Europe. And in Europe, it's definitely trending upwards. And if it's not, I'll just have to speak to the procurement guys because that's the message I've got. Great. Thanks a lot, guys.

Thank you. Our next question comes from Chase Coughlin from Van Lanschot, Kempelen. Your line is now open. Please go ahead.

Yes, good morning, gentlemen, and thank you for taking my questions. Just two quick ones. Firstly, could you provide a bit more colour around your pricing strategy for this year? I mean, you just discussed raw material changes, but also in the context of potentially wage inflation, what sort of pricing measures are you taking? throughout the course of 26. And then the second question, going to advance this, obviously there was sort of somewhat of a rebrand over the last few months. I think it's likely to cause some more traction commercially. I'm just curious on what you're hearing from competitors, especially given the more modular solutions you're offering. I think Verity was quite bullish on this in their last results. I'm just curious on what you're hearing there and how you're seeing that rebrand with customers.

Yes, so in terms of pricing, our approach successfully at all times has been just to pass through. So whatever cost inflation we're seeing, we have always succeeded in getting it through to market. That's over decades. So we don't expect that to really be any different. From a wage inflation perspective, that's not a particular kind of dial mover for us. The materials would be much more significant. and much more public and obvious in terms of our ability to actually pass it through as well. So that's kind of our approach to that. In terms of the positivity that Vertiv has been propagating, we clearly would agree with that. We see it. We're growing into it. We're coming from opposite ends of the spectrum, if you like. We're literally coming from the floor up, up through the white space into grey, I'd say predominantly Virtus is at the higher tech end, very deep and gray, and to some extent kind of moving south into the white. So I think, yeah, there's certainly enough for all, but I think, yeah, we'll be looking, our advances business will be increasingly looking more like it, I'd say more so than the other way around.

Okay, perfect. Thank you for the clarity. Thanks, Jason.

Thank you. Our next question comes from Priya Wolf from Jefferies. Your line is now open. Please go ahead.

Good morning. Thanks for taking my questions. The first one, I guess, is just a clarification just on the U.S. residential roofing. I appreciate you talked about this being something that you're looking at more in the longer term. But in your usual slide on global expansion, you've talked about a plant in Georgia in 2028. So I just wanted to check, is that locked in or is that sort of still PBC? And then the second question is just in terms of capital allocation. You've reiterated that you're looking at the 650 million share buyback in tandem with other growth opportunities. Should we interpret that as you potentially don't fully reach that 650 million level if you see growth? bigger or more interesting organic and M&A opportunities, or you think you'll get there regardless and it's more just about the timing, which is the uncertainty. Thank you.

Okay, so just on the first point, that remains our ambition and our plan. Like that clearly can flex. It's not going to come forward, but it could push out. And that depends largely around timing of machinery, plant construction, all that kind of stuff. as well as market conditions. We clearly want to, at whatever point we enter that side, we want conditions to be as favourable as possible. And naturally, right now, it's about as bad as it's been in recent years. So thankfully, it's not right now that we're entering because they're all under an awful lot of pressure, as you know. But three years from now or whatever, that's some time out. And on the buyback,

Just on the buyback and capital allocation generally, as we've said previously, we at all times compare opportunities that are external to Kingspan versus buying ourselves in terms of the relative valuation of both. We're fortunate that we have a healthy pipeline of development opportunities within the business, both organic and inorganic, and we'll continue to get that balance right and assessment right as we move through the year. We've done about 23% of the announced programme, and we'll just see how that evolves through 2026.

Great. Thank you.

Thank you. Our next question comes from Harry Goad from Berenberg. Your line is now open. Please go ahead.

Yeah, hi, morning. Just a question on the panel's business, please. Can you give us a rough idea of what the annual increase in new capacity is? I appreciate we can't be too exact year to year, but in terms of the percentage number on average over the years, just think about the sort of steady increase in contribution from that division. Thanks.

I guess it's difficult to give a global answer to that in terms of capacity is pretty regional and localised. We're addressing different markets in different parts of the world. Naturally, we've seen very strong intake in a lot of the regions that we've entered over the last decade in particular, like Latin America, APAC, all of those. We've put in a lot of capacity in recent years. but we're now seeing the fruits of that come through intake and orders. So, as I say, it varies very significantly from one region to another, and capacity is regional.

Rather than think about it as one lump sum, Harry, if you go back to that slide 16, just think about the average construction cycle and the investments that we're making. That feeds the 3% outperformance very consistently.

Okay, thank you.

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Thanks. Fantastic. Thank you all for joining, and we'll be in touch over the coming days.