Episode Transcript
[00:00:01] Speaker A: Tilecast news, features and analysis brought to.
[00:00:04] Speaker B: You by diary Vitaladict hello and welcome to Tilecast, your weekly roundup of the top tiling stories from the UK and the rest of the world. As usual, if you do like what you're listening to, don't forget to subscribe and follow us, because then you'll will never miss an episode. And we are aiming to keep doing them week on week. So the best 20 minutes, half an hour of your week. The most valuable, for sure. So I'm here with Jo Simpson as usual, from Dia Retarnect. So, Jo, I gather we have a mix of good news, bad news and some philosophical musings.
[00:00:50] Speaker C: Yeah, that's about the size of it.
[00:00:52] Speaker B: Let's start with the bad news then. You've got a couple of business failures to report, is that right?
[00:00:57] Speaker C: Sadly, yep, that's correct. International decorative surfaces, which claims to be the UK's largest distributor of decorative surfaces, has filed a notice of intention to appoint administrators. With around 500 employees, 80 million pound turnover, it was a significant player, supplying flooring, worktops, laminates, panel products, solid surfaces, composite decking.
In 2022, the company completed a management buyouthenne backed by Chilton Capital. Before that, it was a subsidiary of Saint Gemain. And in April this year, ids appointed a new sales, marketing, commercial and finance directors under CEO Andy Sutton. So it's come as a bit of a shock and we're going to be following this story with interest, as it was a significant player in a dynamic sector and its demise seems to have caught everyone on the hop.
[00:01:52] Speaker B: But I gather they're not alone.
[00:01:53] Speaker C: Unfortunately not. The Basingstoke based stone company, Levantina UK, is also into administration.
This is the distribution subsidiary of the Levantina Group, the spanish based extractor producer and distributor of stone products. The UK operation had sites in Basingstoke and Rotherham and a customer base of around 350 clients, most notably stonemasons and KBB studios. The administrators, Interpath, say that the wider Levantina group outside of the UK is unaffected by this admin process. The Alicante headquartered business is probably best known for its Techland brand and it's one of the, you know, best known brands in this market. And again, probably it's going into an administration will come as a surprise to many.
[00:02:44] Speaker B: So, just in the UK then, that it's folding?
[00:02:48] Speaker C: Exactly. Just in the UK. Right.
[00:02:49] Speaker B: And so do you see a link between the ids and the Levantina closures?
[00:02:53] Speaker C: I think it's hard not to.
The obvious connection is that they're both active in worktops and worktops is a fast changing market sector.
We've got the impact of the silicosis issue on quartz and other solid surfaces, the rapid rise of porcelain workdrop production in the UK and the rest of the world, the emergence of new players, manufacturing players, notably in Asia, and the ongoing impact of Brexit on transport, logistics and all other things. So factor in a pretty much flat lining UK economy, a sluggish construction sector, and maybe the failures are inevitable. But I think there will also be successes along the way.
[00:03:40] Speaker B: Is that all the bad news?
[00:03:42] Speaker C: Sadly not. I mean, it depends how you class bad news, but the national home improvement retailer Wix, which many use as a sort of bellwether brand, has seen its year on year profits fall by almost 25% in the first six months of the year, and with its revenues also down 3.4% in the same period, this pretty well underlines how much slack there is in the uk construction sector at the moment. So it's not a very much bad news story, but it's a pretty bad indicator.
[00:04:12] Speaker B: Are there parts of wix business that perform better than others?
[00:04:16] Speaker C: Yeah, there was a slight uptick in DIY retail sales and significant growth in the trade pro business, which was up 14%. But sadly, this was rather dwarfed by the 18% decline in the retailers design and install business. Despite this, however, Wicks claims that the home improvement market overall continues to offer significant opportunities.
[00:04:38] Speaker B: Okay, well, so DIY sounds good. At least there must be some more good news.
[00:04:43] Speaker C: Well, yes, thankfully there is some. And we'll start with the ongoing CTD story. We've already covered the sale of several stores and the brand assets to tops tiles and the disposal of 16 other sites to styled Limited, which owns the tile giant and tile choice brands. And now comes news that Kajaria Ukpenna Limited, a UK joint venture with the new Delhi headquartered tile manufacturing giant Kajaria Ceramics Limited, they've reached agreement to take over seven other XCTD stores. Viren Mundra, chief executive of Kajari UKP Kajari is the 7th largest tile producer in the world, selling premium tiles in over 35 countries. We opened the UK's largest tile showroom in London, Athenae London, earlier this year. This is the next stage in our UK expansion and we look forward to serving customers from these seven new locations, which are in Brierly Park, Chester, Colchester, Coventry, Croydon, Derby and Northampton.
[00:05:47] Speaker B: So, yeah, what would you make of that then? I mean, do you know the brand at all?
[00:05:53] Speaker C: I do know the brand. I don't say I'm intimate with them, but I've been talking to some of the people they've been recruiting in the UK of late. I mean, there's quite a lot of talent out in the UK market at the moment and they've snapped up some good names. But when I heard this story I was quite surprised. But the more I thought about it, the more it seems like a canny deal. With the indian producers facing the prospect of prohibitive tariffs in the USA and likely to encounter increasingly harsh action by the EU, as has been the case with chinese tile imports, a retail foothold in the UK may prove to be a very astute medium to long term investment. I'd have thought time will tell, but my guess is that other indian producers, and there are a lot of very big producers in India, they may eye up the potential of the UK market and invest as well.
[00:06:42] Speaker B: Okay, so how is the uk construction market looking generally?
[00:06:47] Speaker C: Well, I tend to use the S and P Standard and Poor's global uk construction PMI index as my go to barometer, and the latest PMI report is rather more promising than the government's overall economic stats would suggest. There's a sustained rebound in total business activity in August with robust new order growth, while a more supportive economic backdrop underpinned the latest recovery and construction output volumes. Commercial activity was the best performing segment and it has been for a while, but residential work gained momentum with higher levels of housing the activity supported by improving market conditions and lower borrowing costs. It's early days, but hey, maybe these are the green shoots we've all been hoping for.
[00:07:33] Speaker B: Yeah, that sounds positive. Anything else to share?
[00:07:36] Speaker C: Well, a couple of appointments around the world have caught my eye. Firstly, Mohawk Industries. We all know about them. The biggest player in the tile market with many huge brands, including Marazzi and the Emil Group, have promoted Mauro Vandini to president of the company's global ceramic segment. He will also keep his present role as president of Mohawk's european ceramic business. Quite simply, this probably makes Vendini the most powerful and influential individual in the global ceramic market, bar none. He began his career with the Marazzi Group in 1983, rising through various roles from technical director to vice president of international operations before he became CEO. And when Mohawk acquired Maratse, he became head of the european ceramic business. And this post is going to carry on holding, although he's going to be stepping up. So I think it's very interesting that this american group have appointed an italian to run the ceramics business.
It's a huge vote of confidence in Vandini and you mentioned another appointment. Yes. This is another story from the USA. The National Tile Contractors association has appointed Jeremy Sachs as its new deputy director. The reason I think this is significant is because he has a long and impressive track record. He started his career as director of domestic sales at Tar Miami tile in Miami. He then joined Daltile, where for 18 years he held a variety of roles. He's also been director of sales at Inter Ceramic, vice president of sales at Global Fair, and vice president of sales and marketing for the Aldinger company. The NTCA will surely benefit from this strong commercial background. I think it's a very strong appointment.
[00:09:23] Speaker B: Yeah, no, he's been a very busy honey, hasn't he, throughout his career. So, anything more for tilecast listeners?
[00:09:29] Speaker C: Well, the last big news item this week that I want to talk about, and I think it is very good news, is that the UK's Worktop Fabricators Federation has announced a strategic partnership with the International Surface Fabricators association, based in the USA.
It's hoped that this alliance will enhance resources, training and advocacy for surface fabricators worldwide. The WFF has also forged strategic partnerships with the British Institute of Kitchen, bedroom and Bathroom Installation and the installer show. I think working together in this way is 100% the way forward for the worktop industry as it navigates through silicosis and the other challenges of a Ydezenhe really dynamic and fast moving technology led sector. So, good news.
[00:10:19] Speaker B: Yeah. And collaboration does seem to be the sort of magic word of 2024, doesn't it? Everyone's thinking, who can I work with?
[00:10:26] Speaker C: I think so. And, I mean, I'm hoping I'm doing my small bit to bring some of these parties together because I totally think it's the way forward.
[00:10:35] Speaker B: Okay, brilliant. Well, you've also hinted that there might be something else you want us to about this week.
[00:10:42] Speaker C: Yep. I'm going to sign off this week by exploring the connection between ceramic tiles and donkeys.
[00:10:49] Speaker B: And you're not just talking about various people you might not get on with?
[00:10:53] Speaker C: No, I'm talking full eeyore here.
[00:10:56] Speaker B: I'm game. What's the link?
[00:10:58] Speaker C: Okay, good question. Well, the answer just shows where your mind can wander when you work at home all day writing about tiles.
[00:11:05] Speaker B: Okay, crack on.
[00:11:07] Speaker C: Sure. Okay. I was brought up on a small farm in Berkshire, and one day my mother heard a radio expose about the ill treatment of working donkeys. Somewhere in Europe we had a spare field. And so, lo and behold, next week the whole family was off to the nearest donkey sanctuary and we came home with Jake, named after the humorous folk singer Jake Thackeray and Florence, named after the character in the magic roundabouthenne.
[00:11:33] Speaker B: Well, that's very sweet. I'm still not getting the tiles connection.
[00:11:36] Speaker C: It's coming, I promise. Well, the main thing I remember about donkeys, apart from the fact that they are real characters and 100% independent minded, was my dad telling me that if you pick up a young donkey every day, the donkey will be your friend for life and you will get stronger every day. To be fair, my dad kept this up with Jake for quite a while. Jake thought it was a great game. Florence, on the other hand, was not for lifting. Not once, not ever. The lady was not for lifting.
[00:12:09] Speaker B: Sensible girl. But I'm still not really getting that tile link.
[00:12:12] Speaker C: Well, I was reviewing some of the XXL tiles that are going to feature at Chasei this year and it occurred to me that if you started tiling in the 1980s and every day lifted the largest tile in production in the world, would you by now be able to lift a 3.2 meters by 1.6 meters monster single handedly? And would you still be in love with tiles?
[00:12:34] Speaker B: Possibly not. But anyway, maybe it's time for a mental spring clean, babe.
[00:12:38] Speaker C: Yeah, fair point. But I can't see a donkey to this day without thinking about dad carrying Jake around a field. And now I know that every time I see the image of a large tile in Bologna, I'm going to think the same thing.
[00:12:50] Speaker B: And anyone who's listening to this is probably going to unfortunately suffer the same thing.
[00:12:55] Speaker C: That's my hope.
[00:12:57] Speaker B: Anyway, a fair note to end on. We've got a good thing coming up next week. I gather you off to the North Yorkshire?
[00:13:04] Speaker C: Yes, I'll be having a look at seeing what's new at the flooring show in Harrogate, meeting up with a few old friends from the tile industry and hopefully finding out the latest news. And goss.
[00:13:14] Speaker B: Yeah, well, it's always good to have a trip to Yorkshire. That's Yorkshire, UK, obviously. No Yorkshire anywhere else. Okay, that's brilliant. Thanks, Joe.
[00:13:23] Speaker C: All right, see you, folks.
[00:13:25] Speaker A: You've been listening to tilecast, produced by diary of a tile addict. To ensure you don't miss any future episodes, don't forget to follow us. You can also find show notes and receive updates on newsfeeds, articles, podcasts and videos direct to your inbox by subscribing to the Diaryofataladdict.com website.
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