A strong resurgence in residential building in North America and a “resilient” German residential market contributed to Finnish pipe manufacturer Uponor (Vantaa; www.uponor.com) reporting a 63% year-on-year increase in operating profit to EUR 57.7m, on sales up marginally at EUR 811m in 2012.

The company said while new-build investments were at a low level, increasing renovation activity only partially compensated for lost volumes. The Nordic markets maintained a “nearly satisfactory” level of demand, but the large southwest European markets continued to decline further. Germany, Europe’s largest economy, stood out as the exception in weak European building markets. However, despite that, Uponor president and CEO, Jyri Luomakoski, said he believes the European building market is close to touching bottom and that signs of stabilisation are visible.

Overall demand in municipal infrastructure markets remained flat, with the Baltic countries showing some growth. Increasing concerns over sustainability, and the drive towards conserving energy and utilising renewable energy, benefited the company’s radiant heating and cooling systems, offsetting the slowdown in new build activity. Within plumbing, increased renovation activity and the trend away from traditional metal pipes and components continued, favouring the company’s PEX and composite pipe portfolios.

Operating profit in the company’s European building solutions segment increased by 13% year-on-year to EUR 47.2m in 2012 on sales down 5% at EUR 518m. In North America, the building solutions segment saw profits rise by 75% to EUR 17.8m on sales up 24% at EUR 151m. The infrastructure solutions business, which produces pipes for utilities and infrastructure projects, reported zero operating profit, compared with a loss of EUR 2.4m in 2011, on sales down marginally at EUR 149m.

Luomakoski said: “I am happy to report that we are witnessing a steady, long-term pick-up in demand in North America, which has resulted in Uponor achieving double-digit growth there for the last six quarters. This has resulted in an improved performance, despite the fact that we are simultaneously rebuilding our capacity to the levels we had before the crisis back in 2007.” He added that the company’s plan to merge its infrastructure business with that of family-owned KHW Group (Vasaa / Finland; www.kwhpipe.com) – see Plasteurope.com of 25.09.2012 – is currently awaiting the approval of the Finnish competition authority.

Looking ahead, Uponor said it expects net sales and operating profit to show modest organic growth based on the current business portfolio and organisation and in anticipation that the external environment faces no major unexpected changes.