Brickability upbeat after strong final quarter

Construction materials distributor Brickability Group reported a strong final quarter performance in a trading update on Wednesday, with all business divisions performing well despite an uncertain macroeconomic environment.

The AIM-traded firm said that as a result, it expected to report revenues of £681m for the full year, representing a 30.9% year-on-year increase, or 4% on a like-for-like basis.

Adjusted EBITDA for the year was meanwhile set to be at least £50m, ahead of current market expectations.

The performance of Brickability’s timber business, however, normalised during the year, following an exceptional high in the prior period.

It said revenue growth for the year came in at 15.3% on a like-for-like basis across all of its other categories outside of timber.

Net debt at year-end was expected to total around £8m, due to the increase in expected EBITDA, a reduction in working capital outflow, and a trimming of capital expenditure.

“Whilst remaining conscious of the challenges in some of our segments in the short-term, the group believes that the underlying long-term demand for UK housing remains robust as does the demand for quality materials for the construction sector generally,” the Brickability board said in its statement.

“The board remains confident that the Group is well placed to continue delivering on its strategic objectives and the underlying organic growth of the business.

“In addition, the group's acquisition pipeline remains strong, with the company assessing a number of potential opportunities in line with Brickability's stated strategy to provide geographic and product expansion.”

At 0840 BST, shares in Brickability Group were up 3.82% at 68p.

Reporting by Josh White for Sharecast.com.