REG - Ibstock PLC - Q3 Trading Update

IbstockAnnouncement

25/10/2023 07:00

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RNS Number : 1681R  Ibstock PLC  25 October 2023

25 October 2023

LEI: 2138003QHTNX34CN9V93

 

Ibstock Plc

 

Trading Update

 

Resilient Q3 performance; expectations for FY23 unchanged

 

Ibstock Plc ('Ibstock' or the 'Group'), a leading UK manufacturer of a diverse
range of building products and solutions, announces a trading update for the
third quarter of its financial year ending 31 December 2023 ("the Period").

 

Trading update

 

The Group delivered a resilient performance in the third quarter, reflecting
our continued focus on customer service and execution, coupled with the
disciplined management of capacity and costs.

 

Market demand in the period was more subdued than expected. As a result, and
in line with the wider UK brick industry, sales volumes in the third quarter
were below those achieved during the second quarter of the year. Despite these
weaker volumes, effective cost reduction action combined with stable pricing
resulted in margins for the quarter remaining robust.

 

The Board anticipates that the benefits of its actions will continue to
mitigate demand weakness in the final quarter and, consequently, its
underlying profit expectations for the 2023 financial year are unchanged.

 

Given the ongoing challenging market conditions, we will continue to actively
manage capacity and costs. In doing so, we will ensure that our capacity is
aligned to market demand, whilst ensuring we are well positioned to respond
when activity levels recover.

 

The strength of our balance sheet continues to provide both resilience in more
subdued conditions and strategic optionality for the future. This is reflected
in our ongoing commitment to capability and growth investment, with key
projects progressing well. We continue to expect our new Atlas factory to
commission from the end of 2023, and to bring to market the UK's first
certified carbon-neutral brick in 2024.

 

Residential construction markets are expected to remain subdued in the near
term. Notwithstanding this more cautious outlook we remain confident in our
ability to continue to respond appropriately to market conditions.
Furthermore, we will continue to progress the strategic initiatives that will
underpin growth over the medium term.

 

Joe Hudson, Chief Executive Officer, commented:

 

"The Group delivered a resilient performance in the third quarter despite a
very challenging market backdrop. I am proud of the way that everyone at
Ibstock has remained focused on the delivery of a strong operational
performance while also ensuring that the Group made continued strategic
progress.

 

"As macroeconomic conditions stabilise, we expect a recovery in market
activity, reflecting the significant underlying demand for new build housing
in the UK. Whilst we are taking a cautious view around the pace and timing of
this recovery, we remain confident in our ability to continue to respond to
market conditions, taking the action necessary to protect performance, while
ensuring the business remains well-positioned for an increase in activity."

 

 Ibstock plc             01530 261 999
 Joe Hudson, CEO
 Chris McLeish, CFO

 Citigate Dewe Rogerson  020 7638 9571
 Kevin Smith
 Holly Gillis

 

About Ibstock Plc

Ibstock Plc is a leading UK manufacturer of a diverse range of building
products and solutions. The Group concentrates on eight core product
categories, each backed up by design and technical services capabilities:

 -  Bricks and Masonry, Façade Systems, Roofing, Flooring and Lintels, Staircase
    and Lift Shafts, Fencing and Landscaping, Retaining Walls and Rail and
    Infrastructure.

The Group comprises two core business divisions, Ibstock Clay and Ibstock
Concrete. The Ibstock Futures business was established in 2021 to accelerate
growth in new, fast developing segments of the UK construction market and,
while it remains in its initial growth phase, forms part of the Clay division.

 

Ibstock Clay: The leading manufacturer by volume of clay bricks sold in the
United Kingdom. With 15 manufacturing sites, Ibstock Clay has the largest
brick production capacity in the UK. It operates a network of 18 active
quarries located close to its manufacturing plants. Ibstock Kevington provides
masonry and prefabricated component building solutions, operating from 6
sites.

 

Ibstock Concrete: A leading manufacturer of concrete roofing, walling,
flooring and fencing products, along with lintels and rail &
infrastructure products. The concrete division operates from 14 manufacturing
sites across the UK.

 

Ibstock Futures: Complements the core business divisions by accelerating
diversified growth opportunities which address key construction trends,
including sustainability and the shift towards Modern Methods of Construction
(MMC). Operating from an innovation hub in the West Midlands, and the Nostell
redevelopment in West Yorkshire.

 

Ibstock is headquartered in the village of Ibstock, Leicestershire, with 36
active manufacturing sites across the UK.

 

As a leading building products manufacturer, the Group is committed to the
highest levels of corporate responsibility. The ESG 2030 Strategy sets out a
clear path to address climate change, improve lives and manufacture materials
for life, with an ambitious commitment to reduce carbon emissions by 40% by
2030 and become a net zero operation by 2040.

 

Further information can be found at www.ibstock.co.uk
(http://www.ibstock.co.uk/)

 

Forward-looking statements

This announcement contains "forward-looking statements". These forward-looking
statements include all matters that are not historical facts and include
statements regarding the intentions, beliefs or current expectations of the
directors. By their nature, forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances that are
difficult to predict and outside of the Group's ability to control.
Forward-looking statements are not guarantees of future performance and the
actual results of the Group's operations. Forward-looking statements speak
only as of the date of such statements and, except as required by applicable
law, the Group undertakes no obligation to update or revise publicly any
forward-looking statements.

 

The person responsible for making this announcement is Becky Parker, Group
Company Secretary.

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