This is Dom Cooke and today we’re breaking down an Irish business that has become the global leader in insulation products for buildings. Founded in 1965, the business is called Kingspan and today it has a market cap of nearly 13 billion euros. The bulk of their business comes from insulating big, commercial new builds – Tesla Factories, Apple’s Headquarters, the Emirates Stadium in London – all places where you’ll find Kingspan’s products.
To break down this business, I’m joined by Nick Griffin, the Founding Partner and CIO of Munro Partners. We talk about the ESG tailwinds behind this business, how they’ve grown through acquisitions, and their interesting go-to-market motion. Please enjoy this Business Breakdown of Kingspan.
For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.
-----
This episode is brought to you by Tegus, the modern research platform for leading investors. Stretch your research budget with flexible expert calls you can trust. At a fraction of the cost of traditional expert networks, Tegus customers pay only what an expert charges – with zero markups and no confusing call credits – netting an average 70% savings. Don’t want to conduct a full hour call? Tegus offers the ability to schedule 30-minutes, an offer you won’t find anywhere else. And they don’t stop there. With white-glove custom sourcing for every project and robust compliance measures, including a dedicated 50+ analyst team that vets every call transcript, Tegus ensures your privacy and protection. As the industry innovator for qualitative insights, Tegus helps you find the right experts you need at a quality and speed that can’t be matched. For a limited time, as a listener, you can trial Tegus for free by visiting tegus.co/patrick.
-----
Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss | @ReustleMatt | @domcooke
Show Notes
(00:02:35) - (First question) - He gives us a detailed description of Kingspan
(00:03:28) - Investing in a company based on the other side of the world
(00:05:14) - Whether Kingspan is more commercial or residential driven
(00:05:55) - Kingspan’s origins
(00:08:35) - Description of an insulated panel and how it is used
(00:12:38) - What makes their panels the best in the world
(00:15:25) - The benefits of doing both commercial and residential panels
(00:16:08) - Industry characteristics and its overall market share
(00:17:54) - The pricing mechanism and pricing power behind the product
(00:21:26) - Kingspan’s expansion into the world market
(00:22:53) - The secret sauce behind the success of Kingspan
(00:25:01) - Kingspan’s economy to scale
(00:27:42) - What he finds interesting about Kingspan’s financial profile
(00:29:15) - Splitting revenue growth between organic and inorganic growth
(00:32:35) - The visibility of Kingspan’s products and their measurable efficiency
(00:34:50) - His expectations for Kingspan’s growth over the next 10 to 15 years
(00:34:05) - The margin structure of the acquired businesses
(00:37:12) - The life expectancy of the insulation product
(00:38:35) - Risks behind insulated panels and the industry
(00:42:22) - His evaluation of business modeling for acquisitions
(00:43:23) - Which competitors does he watch most closely
(00:44:49) - The lessons learned from studying Kingspan for 10 years