Beleaguered national window and door installers Safestyle UK saw their share price fall by over 6% on Thursday, adding to fears about the company. There was no trading update issued by the company on Thursday, nor any press releases or news in general. So is this a delayed reaction to the full year results they published recently? Or has there been some kind up news out of the business that shareholders haven’t liked?

Either way, the share price has now hit an all time low since their initial listing. What now for one of the industry’s biggest?

Stark charts

Here are the one day and one year charts that make for pretty grim viewing:

One day chart

Credit: Bloomberg

One year chart

Credit: Bloomberg

The one year chart is the one that sticks out for me. To hit an all time high then an all time low in the space of 12 months only highlights further the staggering reversal in fortunes for the company.

As we know, industry newcomers SafeGlaze UK have been seriously eating into their market at an ultra-aggressive rate. That has no doubt had a major impact. But, if you trace the decline in the share price back, Safestyle’s troubles started well before SafeGlaze came to the market. So whilst it is easy for the company to blame the decline on the industry newcomer right now, their issues started long ago.

They will say that the challenging market conditions have been to blame. There’s no doubt that things have been tough, but only for certain companies. It does appear that only the national installers find themselves in any sort of peril. So many SME installers are doing well right now. But being smaller allows the company to be more agile and reactive to change, meaning their company can adapt and stay out in front. Mega companies like Safestyle lack that agility, either by ignorance or simply burying heads in sands. The biggest still operate old business models and sales methods that more and more home owners simply do not want. It was only a matter of time before we hit the crunch point, and this seems very much to be it.

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Beyond recovery?

The market cap (total value of shares on the stock market) is now just over £65m. That seems like a lot to the average person, but when you consider that the share price is now worth less than a quarter of what it was just about a year or so ago, this is a sustained and large decline.

At this point, you have to wonder if it is now possible for Safestyle to recover from here. A broken business model, combined with a more savvy general public and an ultra-aggressive competitor makes for a perfect storm of bad circumstances.

There are hints that the company has tried to change their image and reputation. Their TV adverts for example have become more bearable, although I still question how true the claims in the ads are compared to real-life experiences with home owners. Their general branding has matured and they have tried to distance themselves away from their tacky past.

But reputations stick hard, and I’m not sure that whatever they do now they may never be able to shift the perception most of us have of the company.

Looking at the wider national installer landscape, there has been further commentary about the state of the other major installers, and it’s all been negative. I have been privy to some reports and storied, nothing I can verify 100% so I cannot put on DGB. But needless to say, it paints a very negative picture of the national installer sector right now.

You do have to wonder if the window and door market could soon be facing a future without a number of the biggest recognised names in the industry.

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