Ibstock builds profit as clay brick business sees volume and price growth
Profits and revenue at brick manufacturer Ibstock rose in 2018 thanks to volume and price growth in the clay brick business.
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In the year to 31 December 2018, pre-tax profit was up 19.1% to £92.5m on revenue of £391.4m, up 7.9%. Meanwhile, adjusted earnings before interest, tax, depreciation and amortisation increased 4.1% to £112.4m and the final dividend was unchanged at 6.5p a share.
Ibstock said revenue growth and adjusted EBITDA were in line with its expectations, with continued "robust" underlying cash generation, supported by proceeds from the sale of the US business and surplus property.
During the year, the group commissioned its new 100 million capacity brick factory in Leicestershire, adding significant new capacity to its UK brick operations. It also took the decision to dispose of its US brick manufacturing business, Glen Gery, to focus on the UK market.
"These changes provide us with a solid platform to deliver future growth and value creation over the medium term," the company said.
Ibstock said UK brick demand continued to outstrip domestic supply capacity last year, resulting in over 0.4 billion imported bricks entering the UK market and further de-stocking from UK manufacturers. It was able to take advantage of this "robust" market environment, with increased volumes from its new Eclipse facility, and further benefit to come this year as the first full year of production.
Chief executive officer Joe Hudson said: "Whilst we remain mindful of the current political and economic uncertainties in the UK, Ibstock is well-positioned, with market fundamentals that remain encouraging for the medium term. We look forward to another year of progress for the group."
At 0925 GMT, the shares were up 3.3% to 259.80p.