Construction products supplier SIG said it plans to invest £200m in acquisitions in the next three years.
The Sheffield-based firm, which supplies insulation, roofing, commercial interiors and construction products, invested £21m bringing 12 companies into its group in 2014.
SIG chief executive Stuart Mitchell said the business already has a strong pipeline of potential deals.
The company is looking to grow within its current markets, both countries and sectors.
“We’re signalling more confidence in the business, and that we’d like to do some slightly larger acquisitions and they’ll be in the UK and in mainland Europe,” he said.
SIG’s 2014 results showed sales up 3.8 per cent on a like-for-like basis, outperforming market growth of 2.8 per cent.
Profit before tax was up nine per cent to £98.1m, ahead of its January trading update of £96.5m.
Post-tax return on capital expenditure climbed 90 basis points to 10.3 per cent.
The business also generated £10m through improvements to business performance, particularly in purchasing.
It is targeting cumulative benefit of £20m from “self-help” and strategic initiatives this year, Mr Mitchell said.
In addition to its acquisitions, SIG divested of three underperforming businesses, including Miller Pattison and ICE Energy.
Final dividend was up 24 per cent, with total dividend up 23.9 per cent to 4.40p per share.
While strong performance in the UK and Ireland drove gains for the business, uncertainty in Europe dampened results towards the end of the year.
SIG group finance director Doug Robertson said revenues were down one per cent on a like-for-like basis in mainland Europe, but foreign exchange impacts resulted in a total fall in revenue of five per cent.
The weakening of the Euro continues to be a risk for the company, he said.
He said: “Foreign exchange translation does remain an issue for us.
“As a rule of thumb, every one Euro cent depreciation of the Euro versus Sterling would hit our profit before tax by half a million pounds on translation.
“It’s not a transactional exposure, but very much a translation exposure.”
The European market is expected to remain flat in the first half of 2015, with possible growth in the second half, he added.
While conditions in Europe will continue to pose a challenge, Mr Mitchell said SIG is confident about the outlook in the UK.
He said: “I think we see a pretty strong year in the UK, that’s right across the country.
“One of the strongest areas for residential growth has been the M62 corridor.
“We continue to see residential performing well and the commercial sector - offices and things like that - which are typically a little bit later in the cycle, that’s starting to kick off.
“That will benefit us towards the end of this year and into 2016.”
Growth for 2015 will be weighted towards the second half of the year due to strong first-half comparators, Mr Mitchell added.