It’s easy to see why investors are riding the momentum in the business while Safestyle, the largest independent PVC window company in the UK, continues to outperform its rivals even in a relatively weak market. This is partly down to a strategic decision to focus on the affluent market in southern England which has boosted both installations and margins earned. But the one percentage point rise in Safestyle’s market share to 9.5 per cent in the first six months of 2015 also reflects the fact that smaller rivals are unable to match the company’s subsidised credit offer which has been pulling in customers. The profit earned on these additional orders more than warrants the subsidy.
It’s also fair to say that when Safestyle releases a pre-close trading statement at the end of this month we can expect further market share gains – the company has posted gains each year for the past decade - and potentially news of a double digit increase in like-for-like sales in the second half of 2015. That’s because the business is up against very soft comparables from the second half of 2014. Indeed, having posted a near 7 per cent rise in first half revenues to £74m, analyst Matthew McEachran at broking house N+1 Singer predicts the company will grow its second half revenues by almost 10 per cent to £73.4m – it could be higher – buoyed by a strong order book, additional marketing spend (both television and digital) and the uptake from the credit offer.