REG - Ibstock PLC - Results for the year ended 31 December 2025
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RNS Number : 4100V Ibstock PLC 05 March 2026
Ibstock Plc
Results for the year ended 31 December 2025
Strategic progress in a challenging market. Well positioned for future growth
Ibstock Plc ("Ibstock" or the "Group"), a leading UK manufacturer of building
products and solutions, announces results for the year ended 31 December 2025.
· Resilient 2025 operating performance and proactive strategic action taken in a
progressively tougher market
· Revenue up 2% to £372m (2024: £366m), Adj. EBITDA of £71m (2024: £79m), in
line with revised guidance
· Commissioning of Atlas and Nostell continues, enhancing efficiency and growth
· Market share gains in Clay, with diversified ceramic facades capability
gaining significant interest
· With market fundamentals intact and major capital expenditure programmes
largely complete, we expect an acceleration in free cash flow generation and
an improved balance sheet in the medium term to provide optionality on future
growth opportunities and shareholder returns
Adjusted Results(1)
Year ended 31 December 2025 2024 ∆ 1Y % change
Revenue £372m £366m +£6m 2%
Adjusted EBITDA £71m £79m (£8)m (10)%
Adjusted EBITDA margin 19.1% 21.7% (260)bps (12)%
Adjusted EPS 5.7p 7.7p (2.0)p (26)%
Adjusted free cashflow £(10)m £11m (£21)m >(100)%
ROCE 5.8% 7.5% (170)bps (23)%
Net debt £120m £122m £2m 2%
lower
Statutory Results
Year ended 31 December 2025 2024 ∆ 1Y % change
Profit before taxation £1m £21m (£20)m (96)%
EPS 0.8p 3.8p (3.0)p (79)%
Total dividend per share 3.0p 4.0p (1.0)p (25)%
Financial Highlights
· Revenue up 2% to £372m (2024: £366m) led by strong new-build growth in H1.
H2 flat YOY
· Clay revenues up 5% to £260m. Concrete revenues of £112m, 5% lower than
prior year
· Weighting of new-build residential with weaker RMI demand resulted in average
pricing marginally down
· Group Adjusted EBITDA(1) down 10% to £71m (2024: £79m) reflecting cost
inflation, adverse product mix and increased costs as capacity reinstated.
Given demand dynamics in H2, we right-sized capacity and reduced headcount.
· Statutory profit before tax of £1m (2024: £21m), reflected lower trading
performance and an exceptional(1) charge of £19 m (2024: £12m)
· Net debt(1) reduced to £120m (2024: £122m) including c.£30m of proceeds
from non-core divestments.
· Recommended final dividend of 1.5p per share (2024: 2.5p) brings the total
dividend for the year to 3p (2024: 4p), representing a 53% pay-out on adjusted
earnings per share.
Strategic progress - positioning for medium term growth
· Atlas factory largely complete, delivering lower cost, more efficient capacity
· Nostell investment progressing through commissioning, with good progress on
the construction of the UK's most advanced ceramic façade facility
· The review of options for our calcined clay opportunity has progressed well
and commercial agreement is well advanced
· As part of our disciplined capital allocation, we took the decision in Q4 to
sell surplus land assets and our Forticrete roofing sites, for total
consideration of c.£30m.
· We continue to look at optionality around our land assets to further
strengthen the balance sheet
Outlook
· After a weather impacted start to 2026, residential construction and RMI
markets expected to remain challenging in H1.
· Current international events in the Middle East are expected to introduce new
uncertainty; the Group is well covered with around 80% of its energy needs
secured for the 2026 financial year.
· Anticipation of some modest year-on-year volume growth in H2 as markets
recover, dependent on demand activity gaining momentum in the Spring
· Pricing actions are expected to offset the impact of cost inflation
· Reflecting our current view of a subdued market, we will be actively managing
production volumes and inventory which will create a margin headwind for 2026
but benefit overall cash generation
· Improved cash generation provides optionality for future growth and capital
returns in the medium term
· The Board remains confident in the medium-term prospects for the business,
although the pace and timing of the recovery remain uncertain
Joe Hudson, Chief Executive Officer, said:
"The 2025 year started well with a solid increase in volumes. The recovery
gave way to tougher conditions in the second half, with market uncertainty
weighing on demand. Nonetheless, I believe this set of results underscores our
resilience and strategic agility against a difficult backdrop.
"Our investments in Atlas and Nostell are largely complete and highlight our
commitment to developing innovative, more efficient and sustainable
capabilities at good rates of return. We continue to make progress with our
review of the calcined clay opportunity, with preferred partner selection and
commercial agreement well advanced.
"I remain confident that underlying market fundamentals remain firmly intact.
Ibstock is well-positioned to capitalise on the recovery, currently
anticipated to begin in H2 2026, with its market leadership position and its
diversified and efficient capacity."
Results presentation
Ibstock is holding a presentation at 11.00 GMT today at Storey Club - Event
Space 1 & 2 (Lower Ground Floor, 100 Liverpool Street, Broadgate EC2M 2AU
Please contact ibstock@cdrconsultancy.com (mailto:ibstock@cdrconsultancy.com)
to register your in-person attendance.
A live webcast of the presentation and Q&A is also available. Please
register here (https://brrmedia.news/IBST_FY25) for the live webcast.
An archived version of today's webcast analyst presentation will be available
on www.ibstock.co.uk
(https://www.ibstock.co.uk/investors/reports-and-presentations) later today.
Ibstock Plc 01530 261 999
Joe Hudson, CEO
Simon Bedford, Interim CFO
Citigate Dewe Rogerson 020 7638 9571
Claire de Groot
About Ibstock Plc
Ibstock Plc is a leading UK manufacturer of building products and solutions,
backed by design and technical services that comprises two core divisions:
Ibstock Clay: The leading manufacturer by volume of clay bricks sold in the
UK, with 15 manufacturing sites served by 15 active quarries. Ibstock
Kevington provides masonry and prefabricated component building solutions,
operating from four sites.
Ibstock Concrete: A leading manufacturer of concrete walling, flooring and
fencing products, along with lintels and rail & infrastructure products.
The concrete division operates from 11 manufacturing sites across the UK.
Both divisions are complemented by Ibstock Futures, which was established in
2021 to accelerate growth in new segments of the UK construction market and
focuses on even more sustainable solutions and Modern Methods of Construction
(MMC) from two main locations.
The Group's 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
(https://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.
(1)Alternative Performance measures are described in Note 3 to this results
announcement
CEO Statement
Introduction
Market dynamics in 2025 changed as the year progressed. After a strong start
to the year, conditions became progressively more challenging. In the first
and second quarter, the market was up 17% and 10% respectively. In the third
quarter growth decelerated to 4% before an actual decline of 2% in the final
quarter compared to the prior period. Overall, total market brick volumes were
1.83 billion (2024: 1.72 billion), c.27% below the recent 2022 peak, although
6% up on prior year. Imports were 352 million (2025: 316 million) representing
19% (2024: 18%) of the market. Our market leadership and differentiated
offering enabled share gains in Clay brick with 8% volume growth.
Average selling prices in brick were marginally down on 2024 reflecting the
tough environment and a shift in mix. We saw more growth in wire-cut bricks
which serves new-build residential whilst demand for our soft mud bricks
exposed to RMI and specification markets was more muted.
As we entered 2025, with market momentum continuing from 2024, we took steps
to re-activate network capacity to meet the recovering demand. However, we
incurred higher than expected incremental costs to reactivate this capacity
and ultimately the initial momentum was not sustained and our capacity moved
ahead of demand.
Given, the evolving demand dynamics in H2, we right-sized capacity and reduced
headcount, focusing on driving efficiencies through both the factory network
and our support functions which will deliver c.£5 million of annualised cost
savings.
With disciplined capital allocation and a focus on priority markets, we
generated c.£30 million of proceeds through the disposal of non-core assets
including the sale of our Forticrete roofing sites and the sale of surplus
land.
The Group remains committed to maximising returns through innovation and
capacity optimisation. Our Atlas investment continues to make progress, with
commissioning underway across its full brick product range. We were pleased to
showcase this facility to investors in late 2025, demonstrating first‑hand
how we are combining cutting‑edge technology, efficiency, and innovation to
set new standards for the industry.
At Nostell, the second phase of the investment programme is also progressing
well. Once complete, it will be the UK's most advanced ceramic façade
facility, producing our new IBrick range which will also support innovative
solutions such as FastWall. These products are already generating significant
interest in the market and provide a new avenue of growth for the Group.
With major capex projects nearing completion, and a high cash drop through on
incremental volumes, we are well positioned to capitalise on a market
recovery, although the timing of a recovery back to normalised levels remains
uncertain. Strategic options, including further land disposals and the
commercialisation of our unique calcined clay reserves, will further
strengthen the balance sheet providing significant optionality in respect of
future growth and capital returns.
Financial Performance
Revenue for the period was up by 2% to £372 million (2024: £366 million). We
saw a strong H1, with brick volume growth of 15%; which contrasted with flat
growth in H2 as markets became tougher. A marginal full year price decline
reflected the challenging trading environment as well as a mix impact with
stronger growth in the new-build residential market and a relatively weak RMI
sector.
Group adjusted EBITDA(1) of £71 million (2024: £79 million) was down 10% and
in line with the revised guidance given in October 2025. Adjusted EBITDA(1)
margin declined to 19.1% (2024: 21.7%). This reflected both inflationary
pressure, increased costs related to reactivating clay capacity, and adverse
product mix including lower volumes in higher margin Concrete categories.
Statutory profit before tax of £1 million (2024: £21 million), reflected
lower trading performance and an exceptional(1) charge of £19 million (2024:
£12 million).
The Group's net debt(1) at year end improved to £120 million (2024: £122
million).
Divisional Review
Clay
The Clay division delivered a resilient volume performance against a tough
market backdrop. Strong volume growth in H1, and a broadly flat H2, resulted
in revenues up 5% to £260 million (2024: £249 million). We saw more growth
in wire-cut bricks which are more favoured in new-build housing markets,
whilst demand for our soft mud bricks, which are more exposed to RMI and
specification markets and concentrated in the South-East / London regions, was
more muted. Within this, Ibstock Futures delivered sales for the full year of
£9 million (2024: £10 million), impacted by Ibstock Telling Glass Reinforced
Concrete (GRC) business ceasing in H1.
A more competitive environment constrained pricing which, together with a
negative shift in sales mix, led to average prices slightly below the
comparative period.
Adjusted EBITDA(1) of £68 million (2024: £72 million) was down by 6% due to
cost inflation, adverse product mix and incremental fixed costs which tapered
as the year progressed. This negative impact was partially offset by firmer
pricing towards the end of the year. Performance benefited from an increase in
inventory, with the absorption of fixed cost as production levels exceeded
sales volumes in the year as demand weakened. The Clay division includes the
financial performance of the Futures business where financial performance
moved forward with overall net costs for the business reducing to £2 million
from £7 million in 2024. Adjusted EBITDA margins for the period for the Clay
division were down by 290 bps to 26.2% (2024: 29.1 %).
Concrete
Revenues within the Concrete division reduced by 5% to £112 million (2024:
£117 million). Residential new-build sales volumes were tempered by lower
growth in the RMI market and falling sales volumes as UK rail infrastructure
markets continued to be impacted by control period spending constraints.
Adjusted EBITDA(1) fell 37% to £9 million (2024: £15 million) with an
adjusted EBITDA margin of 8.3% 2024: 12.5%), reflecting adverse product mix
with lower volumes in higher margin rail infrastructure and RMI markets.
In Q4 2025, we completed the disposal of land assets and our Forticrete
roofing sites, releasing approximately £30 million of capital from non-core
activities. The roofing operation was relatively small, and its exit allows
greater focus on core clay and concrete activities without materially
impacting the Group's future performance.
Sustain, Innovate, Grow
Our operational strategy is anchored around the pillars of Sustain, Innovate
and Grow. To sharpen our focus on execution on these strategic goals we have
defined five focus areas under the banner of a unifying "North Star". Although
the pillars are distinct, in reality many of the initiatives highlighted below
are applicable across all three.
Sustain: Embedding operational and service excellence
A Safe Reliable Production System
Health & safety remains our number one priority as a business.
Whilst in 2025 we made meaningful progress on strengthening safety leadership
across our sites, along with greater risk controls, the Group recorded a Total
Recordable Incident Frequency Rate (TIFR) of 36.6 (2024 31.4) This was driven
primarily by commissioning and transition activities of our large projects -
with multiple learnings taken from the teams.
We also advanced the Safe Reliable Production System programme. This
multi-year initiative will drive an updated, standardised operating model for
all Ibstock factories to improve performance and reliability and embed safe
practices even further.
Customer Focus
We are developing a stronger data-driven approach to demand insights,
including the in-year development of a new Business intelligence platform and
pilot of an AI-enabled forecasting model. We have also taken a more segmented
approach to customers to optimise service levels.
Our in-year customer survey showed our overall relationship rating improving
year on year from 7.65 to 7.93. The survey has now expanded beyond our brick
category into a broader range of product lines, enhancing the depth and
strategic value of customer feedback across the business.
Innovate: Providing new solutions to the UK's critical building needs
Product Development
Existing product development, coupled with new product development (NPD)
focuses on continuously improving our existing range, as well as providing
new, innovative and even more sustainable solutions to the UK construction
industry.
In the Clay division we introduced six new products targeting the
specification market. Along with the new aesthetically focused range from
Atlas, we are building on our proposition of focusing on higher-end customer
requirements.
New product developments from Nostell, such as IBricks and Fastwall have been
well received, as we anticipate the evolving needs of our customers. In
concrete, we have continued to take further steps to increase the use of
recycled content and lower carbon content. Overall, our ratio of new and
sustainable products as a percentage of revenue is consistently improving and
in 2025 increased to 25% (2024: 22%), reflecting positive customer adoption
and effective execution of our development pipeline.
Atlas
Atlas is our pathfinder factory, pioneering cutting‑edge technology and our
most advanced wire‑cut processes to deliver a step change in efficiency. It
sets the model for a high‑performance, lower‑cost, and more sustainable
factory of the future.
Commissioning and ramp‑up progressed well through the year, and we are now
delivering six of the thirteen planned products, with the remainder -
including our carbon‑neutral range - coming online through 2026. The range
has been well received by customers, combining the aesthetics of soft‑mud
bricks with the efficiency and consistency of wire‑cut production, meeting
design-led demand while improving operational performance.
We expect an increasing appetite for these products and a corresponding uplift
in factory profitability driven by Atlas's advanced, efficient manufacturing
model.
The factory has been shortlisted for the Governments second round of Hydrogen
funding known as HAR2. This will reduce costs, increase efficiency and improve
sustainability even further. The new factory has already reduced the level of
carbon emissions by c.50% compared to the original Atlas factory and with the
construction of a green hydrogen facility adjacent to the factory there is the
potential to reduce the carbon footprint by c.75% compared to the original
Atlas factory.
Nostell
The first phase of the Nostell project, the automated brick slips cutting
facility, is fully commissioned. The second phase, a larger scale innovative
ceramics facades line, is progressing well. This new line will bring
unrivalled flexibility and choice to the facades market when fully
commissioned in 2026. We have received an encouraging customer response to
early product and design innovation and have seen a particularly strong market
response to the launch of our Fastwall product. We continue to view Nostell as
enabling a highly attractive source of diversified growth for Ibstock in the
years ahead.
Grow: Diversification and group culture drives growth
Diversification into new markets and segments continues to be a key strategic
priority.
Calcined Clay
Cement and concrete currently contribute around 8% of total global CO2
emissions. Calcined Clay presents the potential to reduce carbon emissions by
around 40% vs ordinary Portland cement, and the footprint of our calcined clay
reserves will enable the first industrial-scale production in the UK.
Following an extensive technical assessment, we have reached the final phase
of the process to realise the potential of our calcined clay reserves, with
preferred partner selection and commercial agreement well advanced.
Sector leading sustainability and social impact
We have made good progress on our sector-leading sustainability and social
impact agenda, sharpening our focus on carbon, product innovation and sector
skills. In year, we were also delighted to report progress on our overall
decarbonisation journey, which now positions us as halfway to achieving our
2030 carbon reduction goal of 40%. In addition to carbon, we made progress in
several other areas of sustainability such as waste & water reduction and
biodiversity.
People and Culture
We aim to set the benchmark within our industry for developing people and
culture with care, courage, trust and teamwork being our fundamental values.
In September 2025, we undertook the Best Companies employee opinion survey and
maintained 'Ones to Watch' status, with an impressive 83% employee
participation rate. We did see a small decline in the overall engagement
index, however, given market conditions and uncertainty, like many other
businesses, this was to be expected. We are however, pleased that we did see
positive feedback on wellbeing and mental health support.
We also remain proud of our Early Careers and Talent management programmes -
providing an all-employee development offering as well as ongoing upskilling
opportunities. This was reflected in the retention of Gold accreditation from
the 5% Club, and our earn & learn positions was 7.2% (2025: 7.4%) still on
track for achieving our 2030 target of 10%. Ibstock remains committed to
building a diverse and inclusive organisation that reflects the communities we
serve. Our focus on gender equity is unchanged, with senior female
representation stable at 32% in 2025 (34% in 2024) despite a number of
organisational changes. We made strong progress in ethnic diversity, with
senior leader representation rising to 15% (2024: 7%), ahead of our 2030
target. Through external partnerships we continue to support industry wide
efforts to advance inclusion and widen access to talent.
Medium- term outlook - building foundations for growth and returns
Although timing of the market recovery remains uncertain, we remain confident
that market fundamentals remain intact and with a well invested, lower-cost,
more efficient and sustainable manufacturing network, we expect to benefit
from meaningful operational leverage across the business. Our clay factory
network has the ability to reactivate a further 20% of network capacity with
minimal additional investment.
With our major organic capital expenditure programmes now largely complete, we
expect an acceleration in free cash flow generation coupled with strategic
actions to further strengthen the balance sheet and provide significant
optionality on future growth and shareholder returns.
Outlook 2026
After a weather impacted start to 2026, residential construction and RMI
markets expected to remain challenging in H1. We expect modest year-on-year
volume growth in H2 2026, with recovery in new-build housing and the RMI
markets, dependent on demand activity gaining momentum in the Spring. Price
increases implemented in February 2026 should enable us to offset anticipated
cost inflation for the year. Current international events in the Middle East
are expected to introduce new uncertainty; the Group is well covered with
around 80% of its energy needs secured for the 2026 financial year. Reflecting
our current view of a subdued market, we will be actively managing production
volumes and inventory creating a margin headwind for 2026 although these
actions will improve working capital efficiency and strengthen the balance
sheet.
Chief Financial Officer's report
Introduction
The Group delivered a resilient performance in 2025, navigating a market
backdrop that became more challenging as the year progressed.
The first half saw strong revenue growth supported by improving end-market
demand. In anticipation of market recovery, we proactively reactivated
productive capacity in Clay to ensure operational readiness. While this would
have strengthened our ability to serve customers as the market recovered, the
associated start-up and incremental operating costs weighed on first-half
profitability within the Clay division.
Market conditions moderated in the second half, with volumes flat compared to
the comparative period. Against a more competitive backdrop, pricing
progression in the core business was modest, limiting our ability to fully
recover cost inflation. Performance was also impacted by an adverse mix
impact, with stronger growth in the new-build residential market and
relatively weaker RMI and infrastructure sectors.
In response to softer demand dynamics, we acted decisively to right-size
capacity and reduce headcount, including rationalizing and consolidating a
number of smaller sites and flexing our soft mud capacity to enhance
operational flexibility and returns. These initiatives across both our
manufacturing network and support functions will deliver approximately £5
million of annualised cost savings from 2026.
Despite the market volatility, we maintained disciplined capital allocation,
focusing investment on priority markets while realising value from non-core
assets. During the year, we generated approximately £30 million of proceeds
from disposals, including the sale of our Forticrete roofing sites and surplus
land.
Group statutory profit before taxation of £0.9 million (2024: £20.7
million), reflected the impact of lower underlying operating profits and an
exceptional charge(1) of £19.5 million (2024: £11.7 million) arising in
relation to the closure and decommissioning activities and restructuring
costs.
The Group's closing net debt(1) reduced to £120 million at 31 December 2025
(2024: £122 million) representing reported leverage(1) of 2.0 times adjusted
EBITDA(1) (Dec 2024: 1.8 times). This year-end position was achieved through a
resilient cash flow performance which included around £30 million of proceeds
through the disposal of non-core assets including the sale of our Forticrete
roofing sites and the sale of surplus land, offset by around £45 million of
capital expenditure (including £24 million of growth expenditure). At 31
December 2025, the Group had £105 million of available liquidity.
With our robust financial position, and inherently cash generative business,
we expect to generate significant cash to support growth and shareholder
returns over the medium term.
Group results
The table below sets out segmental revenue, profit/(loss) before tax and
adjusted EBITDA(1) for the year.
Table 1: Segmental performance
Clay Concrete Central Total
costs(2)
£'m £'m £'m £'m
Year ended 31 December 2025
Total revenue 260.0 112.1 - 372.1
Adjusted EBITDA(1) 68.1 9.3 (6.3) 71.0
Margin 26.2% 8.3% 19.1%
Profit/(loss) before tax 16.8 (2.4) (13.5) 0.9
Year ended 31 December 2024
Total revenue 248.8 117.4 - 366.2
Adjusted EBITDA(1) 72.3 14.6 (7.6) 79.4
Margin 29.1% 12.5% 21.7%
Profit/(loss) before tax 29.5 3.5 (12.3) 20.7
Due to rounding, numbers presented may not add up precisely to the totals
provided and percentages may not precisely reflect the absolute figures
(2) Central costs includes interest charges of £7.0 million (2024: £4.6
million) within Profit/(loss) before tax
Alternative performance measures
This results statement contains alternative performance measures ("APMs") to
aid comparability and further understanding of the financial performance of
the Group between periods. A description of each APM is included in Note 3 to
the financial statements. The APMs represent measures used by management and
the Board to monitor performance against budget, and certain APMs are used in
the remuneration of management and Executive Directors. It is not believed
that APMs are a substitute for, or superior to, statutory measures.
Revenue
Group revenues for 2025 increased by 2% to £372.1 million (2024: £366.2
million), principally driven by strong volume growth in the first half of the
year and a modest reduction in average selling prices across the core
business.
In our Clay Division, revenues of £260.0 million increased 5% on the prior
year period (2024: £248.8 million). Overall, UK brick market deliveries
including imports for 2025 were 6% above the comparative period, with the
Group's performance ahead of this level. The contribution from Ibstock Futures
to this revenue number amounted to around £9.2 million (2024: £9.8 million).
In our Concrete Division, revenue reduced 5% year-on-year to £112.1 million
(2024: £117.4 million). Performance reflected solid volume growth across
residential product categories, offset by rail
volumes which were materially lower year-on-year, as activity levels in UK
rail infrastructure markets
remained at historically low levels.
Adjusted EBITDA(1)
Management measures the Group's operating performance using adjusted EBITDA(1)
and adjusted EBIT(1).
Adjusted EBITDA(1) decreased year on year to £71.0 million in 2025 (2024:
£79.4 million). Performance
reflected higher than expected incremental costs, as we reactivated a
proportion of our clay capacity to
ensure that we were ready to meet anticipated recovering demand, as well as a
competitive market backdrop which limited our ability to pass through cost
inflation.
Within the Clay division, adjusted EBITDA(1) totalled £68.1 million (2024:
£72.3 million), representing an adjusted EBITDA(1) margin of 26.2% (2024:
29.1%). This reflected a lower margin within the core Clay business for the
reasons outlined above, partly mitigated by an improvement in financial
performance within the Ibstock Futures business.
The Clay division recognised a net cost of £2.2 million (2024: cost of £6.6
million) in respect of Ibstock Futures. The Group has continued to invest in
research, development and marketing capability to support future revenue
opportunities.
Adjusted EBITDA(1) in our Concrete division decreased to £9.3 million (2024:
£14.6 million) as the
division was impacted by materially lower sales volumes in our rail product
categories. Adjusted EBITDA(1) margins reduced to 8.3% from 12.5% in 2024,
with the reduction in margin principally reflecting an adverse sales mix
effect, with lower volumes in the rail infrastructure sector which represents
a higher-margin part of the Concrete division.
Central costs decreased to £6.3 million (2024: £7.6 million) reflecting
lower charges arising from incentive plans.
Adjusted EBIT(1)
In order to focus on a more comprehensive measure of operating performance,
the Group has also started to measure and report the Group's performance using
adjusted EBIT(1). Adjusted EBIT(1) is defined as adjusted EBITDA(1) less
underlying depreciation and amortisation.
For the year ended 31 December 2025, adjusted EBIT(1) reduced to £39.7
million (2024: £49.6 million) reflecting reduced trading profits.
Exceptional items(1)
Based on the application of our accounting policy for exceptional items(1),
certain income and expense items have been excluded in arriving at adjusted
EBITDA(1) to aid shareholders' understanding of the Group's underlying
financial performance.
The amounts classified as exceptional(1) in the period totalled a net cost of
£19.5 million (2024: £11.7 million cost), comprising:
1. Exceptional cash cost of £7.4 million (£3.9 million which was cash settled
in the period) associated with the Groups 2025 restructuring programme,
decommissioning activities and other costs associated with previously closed
sites as well as costs directly arising from our decision to close the GRC
business.
2. An exceptional non-cash charge of £10.3 million comprising the impairments
and other charges associated with the 2025 restructuring plan and the closure
of GRC business.
3. An exceptional net loss of £1.8 million arising on disposal of our Forticrete
roofing assets and surplus land.
Further details of exceptional items(1) are set out in Note 5 of the financial
statements.
Finance costs
Net cash interest paid of £9.7 million was above the prior year (2024: £8.6
million) due to higher levels of average debt during the 2025 year. During the
year the Group successfully refinanced its £125 million Revolving Credit
Facility (RCF), at improved pricing versus the existing facility. The Group
continued to benefit from its £100 million private placement at a fixed
coupon of 2.19% per annum, the tranches of which mature between 2028 &
2033. We expect the cash interest expense in the 2026 year to remain at around
£10 million.
Statutory net finance costs of £9.1 million increased in the year (2024:
£6.4 million) reflecting an increased interest cost on our bank borrowings as
the average borrowing on our £125 million RCF increased over the comparative
period, and the reduction in non-cash interest income arising from the unwind
of discounted provisions.
Profit before taxation
Depreciation and amortisation pre fair value uplift increased modestly to
£31.3 million (2024: £29.8 million) reflecting incremental depreciation on
clay growth investments. We expect depreciation and amortisation pre fair
value uplift to total around £35 million in 2026, reflecting incremental
depreciation from the Atlas and Nostell factories.
Group statutory profit before taxation of £0.9 million (2024: £20.7
million), reflected the impact of lower underlying operating profits and an
exceptional charge(1) of £19.5 million (2024: £11.7 million) relating to the
sale of our Forticrete roofing assets, surplus land, site closure and
decommissioning activities, as detailed above.
Taxation
The adjusted ETR(1) (excluding the impact of the deferred tax rate change and
exceptional items(1)) for the 2025 year was 25.5% (2024: 26.0%). For the 2026
year, we expect the adjusted ETR to remain at around 26%, reflecting the 25%
headline rate of UK corporation tax and typical levels of non-deductible
expenses.
The Group recognised a statutory taxation credit of £2.2 million (2024:
charge of £5.6 million) on Group pre-tax profits of £0.9 million (2024:
£20.7 million). The tax credit in 2025 arose principally from the reduction
in statutory profits.
Earnings per share
Group statutory basic earnings per share (EPS) decreased to 0.8 pence in the
year to 31 December 2025 (2024: 3.8 pence) as a result of the Group's trading
performance in the period.
Group adjusted basic EPS(1) of 5.7 pence per share reduced from 7.7 pence in
the prior year, reflecting: a decrease in adjusted EBITDA(1); higher
depreciation and interest charges.
In line with prior years, our adjusted EPS(1) metric removes the impact of
exceptional items(1), the fair value uplifts resulting from our acquisition
accounting and non-cash interest impacts, net of the related taxation
charges/credits. Adjusted EPS(1) has been included to provide a clearer guide
as to the underlying earnings performance of the Group. A full reconciliation
of our adjusted EPS(1) measure is included in Note 7.
Table 2: Earnings per share
2025 2024
pence pence
Statutory basic EPS 0.8 3.8
Adjusted basic EPS(1) 5.7 7.7
Cash flow and net debt(1)
Adjusted operating cash flow decreased by £21.1 million to £35.0 million
(2024: £56.1 million), reflecting a reduction in adjusted EBITDA(1). The
Group also increased working capital levels by £14.1 million (2024: £4.5
million increase) as finished goods inventories increased with progressively
worsening demand. Overall, we anticipate working capital to remain stable in
2026, with the typical seasonal increase at the half year.
Net interest paid in 2025 increased to £10.7 million (2024: £8.6 million)
reflecting higher average net debt levels as the Group drew down on its RCF.
Cash tax amounted to an inflow of £1.4 million (2024: outflow of £0.5
million), as the Group continued to benefit from the accelerated tax deduction
on qualifying capital expenditure. Other cash outflows of £12.6 million
(2024: £9.6 million outflow) principally comprised lease payments totalling
£10.0 million (2024: £9.7 million) and £1.9 million in relation to the
purchase of carbon emission credits (2024: nil).
The Cash conversion(1) percentage decreased to 49% (2024: 71%), reflecting a
reduction in adjusted EBITDA(1) and an investment in inventories, mitigated by
reduced trade receivables.
Adjusted free cash flow(1) decreased to an outflow of £9.8 million (2024:
inflow of £10.9 million). Capital expenditure amounted to £44.8 million
(2024; (£45.2 million), as the Group's investment in its organic growth
project near completion. The 2025 capital expenditure figure comprised £21
million of sustaining expenditure and £24 million of growth investments,
principally on the Atlas and Nostell factories.
In the 2026 year, we expect total capital expenditure to be between £25 and
£30 million, which includes the final outflows in respect of the Atlas and
Nostell factories.
Table 3: Cash flow (non-statutory)
2025 2024 Change
£'m £'m £'m
Adjusted EBITDA(1) 71.0 79.4 (8.4)
Adjusted change in working capital(1) (14.1) (4.5) (9.6)
Net interest (10.7) (8.6) (2.1)
Tax 1.4 (0.5) 1.9
Other(2) (12.6) (9.6) (3.0)
Adjusted operating cash flow(1) 35.0 56.1 (21.1)
Cash conversion(1) 49% 71% (22ppts)
Total capex (44.8) (45.2) 0.4
Adjusted free cash flow(1) (9.8) 10.9 (20.7)
(1) Alternative Performance Measures are described in Note 3 to the
consolidated financial statements.
(2) Other includes operating lease payments in all years and emission
allowance purchases in 2025
The table above excludes cash flows relating to exceptional items(1) in both
years. During 2025, the Group realised £31.2 million of exceptional cash
inflows relating to the sale of our Forticrete roofing business and surplus
land (2024: £nil), which had been offset by site closure and decommissioning
activities cash outflows of £5.1 million (2024: £11.2 million).
Net debt(1) (borrowings less cash) at 31 December 2025 totalled £120.0
million (31 December 2024: £121.6 million; 30 June 2025: £144.5 million),
representing leverage(1) of 2.0 times adjusted EBITDA(1) (Dec 2024: 1.8
times).
We disposed of the first tranche of a closed site at Ravenhead in the North
West during the period, recognising non-exceptional cash proceeds of £3
million and a profit on disposal of just over £1.5 million. We continue to
expect to realise proceeds of around £20 million to £30 million from the
land estate over the coming 3 to 5 years.
The Group's borrowings contain leverage covenants of no greater than 3.0x.
Based on the covenant definition, leverage at 31 December 2025 totalled 1.7
times, comfortably below the covenant limit. At 31 December 2025, the Group
had drawn £42 million under its Revolving Credit Facility (RCF) and had £105
million of available liquidity.
The present value of lease liabilities decreased to around £29.5 million
(2024: £35.0 million) due to the completion of a number of operating lease
contracts for mobile plant.
Return on capital employed(1)
Return on capital employed(1) (ROCE) in 2025 reduced to 5.8% (2024: 7.5%)
reflecting a decrease in adjusted operating profit and an increase in the
capital base, as the Group approached the conclusion of its organic investment
programme.
Capital allocation
Our capital allocation framework principles remain consistent with that laid
out previously, with the Group focused on allocating capital in a disciplined
and dynamic way. We have refined our order as set out below:
· Firstly, we will prioritise investment to maintain and enhance our existing
asset base and operations;
· Secondly, we are focused on a paying an ordinary dividend, with targeted cover
of approximately 2 times underlying earnings through the cycle;
· Thereafter, we deploy capital for in-organic growth or return surplus capital
to shareholders in accordance with our strategic and financial investment
criteria.
Our framework remains underpinned by our commitment to maintaining a strong
balance sheet, and we will look to maintain leverage at between 0.5 and 1.5
times net debt(1) to adjusted EBITDA(1) excluding the impact of IFRS 16,
through the cycle.
Dividend
The Board has recommended a final dividend of 1.5p per share (2024: 2.5p), for
payment on 29 May 2026 to shareholders on the register on 8 May 2026. This
will bring the full year dividend to 3.0p (2024: 4.0p), representing a pay-out
of 53% of adjusted basic earnings per share.
Pensions
At 31 December 2025, the defined benefit pension scheme ("the scheme") was in
an actuarial accounting surplus position of £6.0 million (2024: surplus of
£7.8 million). Applying the valuation principles set out in IAS19, at the
year end the scheme had asset levels of £322.9 million (31 December 2024:
£330.9 million) against scheme liabilities of £316.9 million (31 December
2024: £323.1 million).
On 20 December 2022, the Scheme completed a full buy-in transaction with a
specialist third-party provider, which represented a significant step in the
Group's continuing strategy of de-risking its pensions exposure. This
transaction, which involved no initial cash payment by the Company, completed
during the 2024 financial year. Together with the partial buy-in transaction
completed in 2020, this insures the vast majority of the Group's defined
benefit liabilities.
In light of the fact that the pension scheme was in a net surplus position
after the full buy-in, the Trustees and the Group agreed that the Group would
suspend further contributions with effect from 1 March 2024.
Climate Change & TCFD
As a long-term, energy intensive business, a commitment to environmental
sustainability and social progress is central to our purpose. In 2022 we
launched the Group's ESG 2030 Strategy and remain committed to this approach.
This strategy provides the framework for actions across three key areas:
• Addressing climate change;
• Improving lives; and,
• Manufacturing materials for life.
At the same time, we have identified material transition and physical risks
over the medium to long term associated with climate change and considered the
impacts of these on the financial performance and position of the Group,
through our viability scenario assessment, our impairment testing and
assessment of the useful economic lives of our assets. We have also assessed
the resilience of our business model as part of our strategic planning
process. The outputs from these activities are detailed in our TCFD
disclosures contained in the 2025 Annual Report and Accounts.
The Group remains committed to increasing the transparency of reporting around
climate impacts, risks, and opportunities. This year we continued to enhance
our disclosure to ensure full compliance with the recommendations of the Task
Force for Climate-related Financial Disclosures (TCFD) and those of
Climate-related Financial Disclosure (CFD).
Related party transactions
Related party transactions are disclosed in Note 16 to the consolidated
financial statements. During the current and prior year, there have been no
material related party transactions.
Subsequent events
Except for the proposed ordinary dividend, no further subsequent events
requiring either disclosure or adjustment to these financial statements have
arisen since the balance sheet date.
Going concern
The Directors are required to assess whether it is reasonable to adopt the
going concern basis in preparing the financial statements.
In arriving at their conclusion, the Directors have given due consideration to
whether the funding and liquidity resources are sufficient to accommodate the
principal risks and uncertainties faced by the Group.
Having considered the outputs from this work, the Directors have concluded
that it is reasonable to adopt a going concern basis in preparing the
financial statements. This is based on an expectation that the Company and the
Group will have adequate resources to continue in operational existence for at
least twelve months from the date of signing these accounts.
Further information is provided in note 2 of the financial statements.
(1)Alternative Performance measures are described in Note 3 to this results
announcement
Statement of directors' responsibilities in relation to the financial
statements
The 2025 Annual Report and Accounts which will be issued in March 2026,
contains a responsibility statement in compliance with DTR 4.1.12 of the
Listing Rules which sets out that as at the date of approval of the Annual
Report on 4 March 2026, the Directors confirm to the best of their knowledge:
- the Group and unconsolidated Company financial statements, prepared in
accordance with the applicable set of accounting standards, give a true and
fair view of the assets, liabilities, financial position and profit or loss of
the Group and Company, and the undertakings included in the consolidation
taken as a whole; and
- the performance review contained in the Annual Report and Accounts includes
a fair review of the development and performance of the business and the
position of the Group and the undertakings including the consolidation taken
as a whole, together with a description of the principal risks and
uncertainties they face.
This responsibility statement was approved by the Board of Directors on 4
March 2026 and is signed on its behalf by:
Joe Hudson Richard Akers
Chief Executive Officer Chair
4 March 2026 4 March 2026
CONSOLIDATED INCOME STATEMENT
Notes Year ended Year ended
31 December 2025 31 December 2024
£'000 £'000
Revenue 4 372,104 366,207
Cost of sales (276,121) (261,650)
Gross profit 95,983 104,557
Distribution costs (36,389) (34,139)
Administrative expenses (51,798) (45,650)
Profit on disposal of property, plant and equipment 178 261
Other income 2,340 2,314
Other expenses (280) (270)
Operating profit 10,034 27,073
Finance costs (9,811) (8,287)
Finance income 673 1,894
Net finance cost (9,138) (6,393)
Profit before taxation 896 20,680
Taxation 6 2,178 (5,588)
Profit for the financial year 3,074 15,092
Profit attributable to:
Owners of the parent 3,074 15,092
Notes pence per share pence per share
Earnings per share
Basic - continuing operations 7 0.8 3.8
Diluted - continuing operations 7 0.8 3.8
Non-GAAP measure
Reconciliation of Adjusted EBIT and Adjusted EBITDA to Operating profit for
the financial year for continuing operations
Notes Year ended Year ended
31 December 2025 31 December 2024
£'000 £'000
Operating profit 10,034 27,073
Add back exceptional items impacting operating profit 5 19,478 11,720
Add back incremental depreciation and amortisation following fair value uplift 4 10,236 10,779
Adjusted EBIT 39,748 49,572
Add back depreciation and amortisation pre fair value uplift 4 31,296 29,778
Adjusted EBITDA 71,044 79,350
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Notes Year ended Year ended
31 December 2025 31 December 2024
£'000 £'000
Profit for the financial year 3,074 15,092
Other comprehensive expenses:
Items that may be reclassified to profit or loss:
Change in fair value of cash flow hedges 64 (54)
Related tax movements (20) 14
44 (40)
Items that will not be reclassified subsequently to profit or loss:
Remeasurement of post-employment benefit assets and obligations 13 (1,002) (1,457)
Related tax movements 324 437
(678) (1,020)
Other comprehensive expense for the year net of tax (634) (1,060)
Total comprehensive income for the year, net of tax 2,440 14,032
Total comprehensive income attributable to:
Owners of the Company 2,440 14,032
CONSOLIDATED BALANCE SHEET
Notes 31 December 2025 31 December 2024
£'000 £'000
Assets
Non-current assets
Intangible assets 66,447 73,950
Property, plant and equipment 455,147 462,504
Right-of-use assets 23,292 28,363
Post-employment benefit asset 13 5,984 7,839
550,870 572,656
Current assets
Inventories 137,448 124,819
Current tax recoverable 3,186 1,323
Trade and other receivables 32,273 43,815
Cash and cash equivalents 20,971 9,292
193,878 179,249
Assets held for sale - 200
Total assets 744,748 752,105
Current liabilities
Trade and other payables (89,482) (88,853)
Derivative financial instrument - (78)
Borrowings 8 (41,152) (31,425)
Lease liabilities (9,588) (9,471)
Provisions 9 (5,595) (3,010)
(145,817) (132,837)
Net current assets 48,061 46,612
Total assets less current liabilities 598,931 619,268
Non-current liabilities
Borrowings 8 (99,862) (99,427)
Lease liabilities (19,922) (25,611)
Deferred tax liabilities (88,695) (91,940)
Provisions 9 (7,992) (7,027)
(216,471) (224,005)
Total liabilities (362,288) (356,842)
Net assets 382,460 395,263
Equity
Share capital 4,096 4,096
Share premium 4,458 4,458
Retained earnings 769,760 783,800
Other reserves 14 (395,854) (397,091)
Total equity 382,460 395,263
CONSOLIDATED SATEMENT OF CHANGES IN EQUITY
Share capital Share Retained Other Total equity Total
premium earnings reserves Attributable equity
to owners
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2025 4,096 4,458 783,800 (397,091) 395,263 395,263
Profit for the year - - 3,074 - 3,074 3,074
Other comprehensive (expense)/income - - (678) 44 (634) (634)
Total comprehensive income for the year - - 2,396 44 2,440 2,440
Transactions with owners:
Share-based payments - - 484 - 484 484
Current tax on share-based payment - - 45 - 45 45
Deferred tax on share-based payment - - 13 - 13 13
Equity dividends paid - - (15,785) - (15,785) (15,785)
Issue of own shares held on exercise of share options - - (1,193) 1,193 - -
At 31 December 2025 4,096 4,458 769,760 (395,854) 382,460 382,460
Share Share Retained Other Total equity Total
capital premium earnings reserves Attributable equity
to owners
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2024 4,096 4,458 790,971 (399,658) 399,867 399,867
Profit for the year - - 15,092 - 15,092 15,092
Other comprehensive expense - - (1,020) (40) (1,060) (1,060)
Total comprehensive income/(expense) for the year - - 14,072 (40) 14,032 14,032
Transactions with owners:
Share-based payments - - 1,253 - 1,253 1,253
Deferred tax on share-based payment - - 124 - 124 124
Equity dividends paid - - (20,031) - (20,031) (20,031)
Issue of own shares held on exercise of share options - - (2,607) 2,607 - -
At 31 December 2024 4,096 4,458 783,800 (397,091) 395,263 395,263
CONSOLIDATED CASH FLOW STATEMENT
Year ended Year ended
31 December 2025 31 December 2024
Notes £'000 £'000
Cash flow from operating activities
Cash generated from operations 11 48,035 62,906
Interest paid (7,776) (6,257)
Other interest paid - lease liabilities (2,048) (2,494)
Tax received/(paid) 1,359 (500)
Net cash inflow from operating activities 39,570 53,655
Cash flows from investing activities
Purchase of property, plant and equipment (44,776) (45,235)
Proceeds from sale of property plant and equipment 3,134 379
Proceeds from sale of property plant and equipment - exceptional 31,207 -
Purchase of intangible assets (1,912) -
Settlement of deferred consideration - 171
Interest received 142 139
Net cash outflow from investing activities (12,205) (44,546)
Cash flows from financing activities
Dividends paid (15,785) (20,031)
Drawdown of borrowings 84,000 87,000
Repayment of borrowings (73,000) (81,000)
Debt issue costs (1,040) -
Repayment of lease liabilities (9,998) (9,651)
Net cash outflow from financing activities (15,823) (23,682)
Net decrease in cash and cash equivalents 11,542 (14,573)
Cash and cash equivalents at beginning of the year 9,292 23,872
Exchange gains/(losses) on cash and cash equivalents 137 (7)
Cash and cash equivalents at end of the year 20,971 9,292
Reconciliation of changes in cash and cash equivalents to movement in net debt
Year ended Year ended
31 December 2025
31 December 2024
£'000 £'000
Net decrease in cash and cash equivalents 11,542 (14,573)
Proceeds from borrowings (84,000) (87,000)
Repayment of borrowings 73,000 81,000
Non-cash debt movement 838 (364)
Effect of foreign exchange rate changes 137 (7)
Movement in net debt 1,517 (20,944)
Net debt at start of year (121,560) (100,616)
Net debt at end of year (Note 3) (120,043) (121,560)
Comprising:
Cash and cash equivalents 20,971 9,292
Short-term borrowings (Note 8) (41,152) (31,425)
Long-term borrowings (Note 8) (99,862) (99,427)
(120,043) (121,560)
1. AUTHORISATION OF FINANCIAL STATEMENTS
The consolidated financial statements of Ibstock Plc, which has a premium
listing on the London Stock Exchange, for the year ended 31 December 2025 were
authorised for issue in accordance with a resolution of the Directors on 4
March 2026. The balance sheet was signed on behalf of the Board by J Hudson
and R Akers. Ibstock Plc is a public company limited by shares, which is
incorporated and registered in England. The registered office is Leicester
Road, Ibstock, Leicestershire, LE67 6HS and the company registration number is
09760850.
2. BASIS OF PREPARATION
The consolidated financial statements of Ibstock Plc for the year ended 31
December 2025 have been prepared in accordance with UK adopted IAS in
conformity with the requirements of the Companies Act 2006 and in accordance
with UK adopted IFRS, The comparative financial information has also been
prepared on this basis.
The financial information set out does not constitute the Company's statutory
accounts for the year ended 31 December 2025 but is derived from those
accounts. Statutory accounts for 2025 will be delivered to the registrar of
companies in due course. The auditors have reported on those accounts; their
reports were (i) unqualified, (ii) did not include a reference to any matters
to which the auditors drew attention by way of emphasis without qualifying
their report and (iii) did not contain a statement under Section 498 (2) or
(3) of the Companies Act 2006 in respect of the accounts for 2024. The
consolidated financial statements are presented in Pounds Sterling and all
values are rounded to the nearest thousand (£'000) except where otherwise
indicated. The significant accounting policies are set out below.
Basis of consolidation
The consolidated financial statements of Ibstock Plc for the year ended 31
December 2025 have been prepared in accordance with UK adopted International
Accounting Standards (IAS). The financial statements of subsidiaries are
prepared for the same reporting period as the Parent Company, using consistent
accounting policies. All intra-Group balances, transactions, income and
expenses and profit and losses resulting from intra-Group transactions have
been eliminated in full.
Subsidiaries are consolidated from the date on which the Group obtains control
and cease to be consolidated from the date on which the Group no longer
retains control. The Group controls an entity when the Group is exposed to, or
has rights to, variable returns from its involvement with the entity and has
the ability to affect those returns through its power over the entity.
Going concern
Despite the macroeconomic downturn, there are initial positive external market
indicators with inflation continuing to fall and mortgage rates stabilising,
and proposed housing and planning policy changes which could increase both
housing construction activity and effective demand for housing looking
forward. The directors do not believe that the going concern basis of
preparation represents a significant judgement.
The Group's financial planning and forecasting process consists of a budget
for the next year followed by a medium-term projection. The Directors have
reviewed and robustly challenged the assumptions about future trading
performance, operational and capital expenditure and debt requirements within
these forecasts including the Group's liquidity and covenant forecasts, and
stress testing within their going concern assessment.
In arriving at their conclusion on going concern, the Directors have given due
consideration to whether the funding and liquidity resources above are
sufficient to accommodate the principal risks and uncertainties faced by the
Group, particularly those relating to economic conditions and operational
disruption. The strategic report sets out in more detail the Group's approach
and risk management framework.
Group forecasts have been prepared which reflect both actual conditions and
estimates of the future reflecting macroeconomic and industry-wide
projections, as well as matters specific to the Group.
The Group has financing arrangements comprising £100 million of private
placement notes with maturities between November 2028 and November 2033, and a
£125 million RCF maturing in November 2029 with one -year extension option.
At 31 December 2025 the RCF was £42.0 million drawn.
Covenants under the Group's RCF and private placement notes require leverage
of no more than 3 times net debt to adjusted EBITDA(1), and interest cover of
no less than 4 times, tested bi-annually at each reporting date with reference
to the previous 12 months. At 31 December 2025 covenant requirements were met
with significant headroom.
The key uncertainty faced by the Group is the industry demand for its
products. Accordingly, the Group has modelled financial scenarios which see
reduction in the industry demand for its products thereby stress testing the
Group's resilience. For each scenario, cash flow and covenant compliance
forecasts have been prepared. In the most severe but plausible scenario
industry demand for Clay products is projected to be around 35% lower than
lower than the demand levels experienced in five of the past ten years
('benchmarked demand levels'), in the 2026 year (10% below 2025 levels),
recovering to around 25% lower in 2027 (5% above 2025 levels), with
management's base case reflecting a modest cyclical recovery following the
prolonged sector downturn.
In the severe but plausible scenario, the Group has sufficient liquidity and
headroom against its covenants, with covenant headroom expressed as a
percentage of annual adjusted EBITDA(1) being in excess of 20%.
In addition, the Group has prepared a reverse stress test to evaluate the
industry demand reduction at which it would be likely to breach the debt
covenants, before any further mitigating actions are taken. This test
indicates that, at a reduction of 41% in sales volumes versus the benchmarked
demand levels in 2026 and a reduction of 43% in the first half of 2027, the
Group would be at risk of breaching its covenants.
The Directors consider this to be a highly unlikely scenario, and in the event
of an anticipated covenant breach, the Group would seek to take further steps
to mitigate, including the disposal of valuable land and building assets and
additional restructuring steps to reduce the fixed cost base of the Group.
Having taken account of the various scenarios modelled, and in light of the
mitigations available to the Group, the Directors are satisfied that the Group
has sufficient resources to continue in operation for a period of not less
than 12 months from the date of this report. Accordingly, the consolidated
financial information has been prepared on a going concern basis.
3. ALTERNATIVE PERFORMANCE MEASURES
Alternative Performance Measures ("APMs") are used within this report where
the directors believe it is necessary to do so in order to provide further
understanding of the financial performance of the Group. The Group uses APMs
in its own assessment of performance and in order to plan the allocation of
internal capital and resources. Certain APMs are also used in the remuneration
of senior management and executive directors.
APMs serve as supplementary information for users of the financial statements
and are not intended to be a substitute for, or superior to, statutory
measures. None of the APMs are outlined within IFRS and they may not be
comparable with similarly titled APMs used by other companies.
Exceptional items
The Group presents as exceptional at the foot of the Group's Condensed
consolidated income statement those items of income and expense which, because
of their materiality, nature and/or expected infrequency of the events giving
rise to them, merit separate presentation to allow users of the financial
statements to understand further elements of financial performance in the
year. This facilitates comparison with comparative periods and the assessment
of trends in financial performance over time.
Details of all exceptional items are disclosed in Note 5.
Adjusted EBIT, Adjusted EBITDA and Adjusted EBITDA margin
Adjusted EBIT represents earnings before interest and taxation and is adjusted
to exclude exceptional items and the incremental depreciation and amortisation
arising from historic fair value uplifts.
Adjusted EBITDA is earnings before interest, taxation, depreciation and
amortisation and is adjusted to exclude exceptional items. Adjusted EBITDA
margin is Adjusted EBITDA expressed as a proportion of revenue.
The Directors regularly use Adjusted EBIT and Adjusted EBITDA margin as key
performance measures in assessing the Group's profitability. The measures are
considered useful to users of the financial statements as they represent
common APMs used by investors in assessing a company's operating performance,
when comparing its performance across periods as well as being used in the
determination of Directors' variable remuneration.
A full reconciliation of Adjusted EBIT and Adjusted EBITDA is included at the
foot of the Group's Condensed consolidated income statement within the
consolidated financial statements. Adjusted EBITDA margin is included within
Note 4.
Adjusted EPS
Adjusted EPS is the basic earnings per share adjusted for exceptional items
and fair value adjustments (being the amortisation and depreciation on fair
value uplifted assets and non-cash interest), net of the associated taxation
on these adjusting items.
The Directors have presented Adjusted EPS as they believe the APM represents
useful information to the user of the financial statements in assessing the
performance of the Group, when comparing its performance across periods, as
well as being used in the determination of Directors' variable remuneration.
Additionally, the APM is considered by the Board when determining the proposed
level of ordinary dividend. A full reconciliation is provided in Note 7.
Net debt and Net debt to adjusted EBITDA ("leverage") ratio
Net debt is defined as the sum of cash and cash equivalents less total
borrowings at the balance sheet date. This does not include lease liabilities
arising upon application of IFRS 16 in order to align with the Group's banking
facility covenant definition.
The Net debt to adjusted EBITDA ratio definition removes the operating lease
expense benefit generated from IFRS16 compared to IAS 17 within adjusted
EBITDA.
The Directors disclose these APMs to provide information as a useful measure
for assessing the Group's overall level of financial indebtedness and when
comparing its performance and position across periods.
A full reconciliation of the net debt to adjusted EBITDA ratio (also referred
to as 'leverage') is set out below:
Year ended Year ended
31 December 2025 31 December 2024
£'000 £'000
Net debt (120,043) (121,560)
Adjusted EBITDA 71,044 79,350
Impact of IFRS 16 (12,045) (12,134)
Adjusted EBITDA prior to IFRS 16 58,999 67,216
Ratio of net debt to adjusted EBITDA 2.0 1.8
Adjusted Return on Capital Employed (Adjusted ROCE)
Adjusted Return on Capital Employed ("Adjusted ROCE") is defined as Adjusted
earnings before interest and taxation as a proportion of the average capital
employed (defined as net debt plus equity excluding the pension surplus). The
average is calculated using the period end balance and corresponding preceding
reported period end balance (year end or interim).
The Directors disclose the Adjusted ROCE APM in order to provide users of the
financial statements with an indication of the relative efficiency of capital
use by the Group over the period, assessing performance between periods as
well as being used within the determination of executives' variable
remuneration.
The calculation of Adjusted ROCE is set out below:
Year ended Year ended
31 December 2025 31 December 2024
£'000 £'000
Adjusted EBITDA 71,044 79,350
Less depreciation (35,210) (33,495)
Less amortisation (6,322) (7,062)
Adjusted earnings before interest and taxation 29,512 38,793
Average net debt 132,275 129,699
Average equity 386,673 394,836
Average pension (6,483) (8,305)
Average capital employed 512,465 516,230
Adjusted ROCE 5.8% 7.5%
Average capital employed figures are derived using the following closing
balance sheet values:
31 December 30 June 31 December 30 June
2025 2025 2024 2024
£'000 £'000 £'000 £'000
Net debt 120,043 144,506 121,560 137,838
Equity 382,460 390,886 395,263 394,409
Less: Pension assets (5,984) (6,982) (7,839) (8,771)
Capital employed 496,519 528,410 508,984 523,476
Adjusted effective tax rate
The Group presents an adjusted effective tax rate (Adjusted ETR) within its
Financial Review. This is disclosed in order to provide users of the financial
statements with a view of the rate of taxation borne by the Group adjusted for
exceptional items, fair value adjustments (being the amortisation and
depreciation on fair value uplifted assets), non-cash interest and changes in
taxation rates on deferred taxation.
A reconciliation of the adjusted ETR to the statutory UK rate of taxation is
included in Note 6.
Cash flow related APMs
The Group presents an adjusted cash flow statement within its Financial
Review. This is disclosed in order to provide users of the financial
statements with a view of the Group's operating cash generation before the
impact of cash flows associated with exceptional items (as set out in Note 5)
and stated after interest, lease payment and non-exceptional property
disposal-related cash flows.
The Directors use this APM table to allow shareholders to further understand
the Group's cash flow performance in the period, to facilitate comparison with
comparative periods and to assess trends in financial performance. This table
contains a number of APMs, as described below and reconciled in the following
table.
Adjusted change in working capital:
Adjusted change in working capital represents the statutory change in working
capital adjusted for the cash inflow changes associated with
exceptional items arising in the year of £4.2 million (2024: cash outflow of
£3.1 million).
Adjusted operating cash flow:
Adjusted operating cash flows are the cash flows arising from operating
activities adjusted to cash outflows relating to exceptional items of £5.1
million (2024: cash outflows of £11.2 million) but stated after cash flows
associated with: interest income; proceeds from the sale of property, plant
and equipment; purchase of intangibles; and lease payments reclassified from
investing or financing activities totalling cash outflow of £9.7 million
(2024: cash outflow of £9.0 million).
Cash conversion:
Cash conversion is the ratio of Adjusted operating cash flow (defined above)
to Adjusted EBITDA (defined above). The Directors believe this APM provides a
useful measure of the Group's efficiency of its cash management during the
period.
Adjusted free cash flow:
Adjusted free cash flow represents Adjusted operating cash flow (defined
above) less total capital expenditure. The Directors use the measure of
Adjusted free cash flow as a measure of the funds available to the Group for
the payment of distributions to shareholders, for use within M&A activity
and other investing and financing activities.
Year ended Statutory Exceptional Reclassification Adjusted
31 December 2025
£'000 £'000 £'000 £'000
EBITDA 51,566 19,478 - 71,044
Change in working capital (9,901) (4,228) - (14,129)
Impairment charges 6,336 (6,336) - -
Write-off of inventory 2,408 (2,408) - -
Net interest (9,824) - (898) (10,722)
Tax 1,359 - - 1,359
Post-employment benefits 1,247 - (1,247) -
Other (3,621) (1,414) (7,529) (12,564)
Operating cash flow 39,570 5,092 (9,674) 34,988
Cash conversion 49%
Total capex (44,776) - - (44,776)
Free cash flow (5,206) 5,092 (9,674) (9,788)
Year ended 31 December 2024 Statutory Exceptional Reclassification Adjusted
£'000 £'000 £'000 £'000
Adjusted EBITDA 67,630 11,720 - 79,350
Change in working capital (7,627) 3,103 - (4,524)
Impairment charges 3,832 (3,832) - -
Net interest (8,751) - 139 (8,612)
Tax (500) - - (500)
Post-employment benefits 959 - (959) -
Other (1,644) 212 (8,142) (9,574)
Adjusted operating cash flow 53,899 11,203 (8,962) 56,140
Cash conversion 71%
Total capex (45,235) - - (45,235)
Adjusted free cash flow 8,664 11,203 (8,962) 10,905
4. SEGMENT REPORTING
The Directors consider the Group's reportable segments to be the Clay and
Concrete Divisions.
One of the key Group performance measures is Adjusted EBITDA, as detailed
below, which is defined in Note 3. The tables, below, present revenue and
Adjusted EBITDA and profit before taxation for the Group's segments.
Included within the "Unallocated and elimination" columns in the tables below
are costs including share-based payments and Group employment costs.
Unallocated assets and liabilities are pensions, taxation and certain
centrally held provisions. Eliminations represent the removal of inter-company
balances. Transactions between segments are carried out at arm's length. There
is no material inter-segmental revenue, and no aggregation of segments has
been applied.
For all the periods presented, the activities of Ibstock Futures were managed
and reported as part of the Clay Division. Consequently, the position and
performance of Ibstock Futures for all periods has been classified within the
Clay segment.
Year ended
31 December 2025
Clay Concrete Unallocated & Total
elimination
£'000 £'000 £'000 £'000
Total revenue 259,997 112,107 - 372,104
Adjusted EBITDA 68,062 9,289 (6,307) 71,044
Adjusted EBITDA margin 26.2% 8.3% 19.1%
Exceptional items impacting operating profit (see Note 5) (17,453) (1,974) (51) (19,478)
Depreciation and amortisation pre fair value uplift (25,858) (5,299) (139) (31,296)
Incremental depreciation and amortisation following fair value uplift (6,080) (4,156) - (10,236)
Net finance costs (1,850) (268) (7,020) (9,138)
Profit/(loss) before tax 16,821 (2,408) (13,517) 896
Taxation 2,178
Profit for the year 3,074
Consolidated total assets 636,724 95,308 12,716 744,748
Consolidated total liabilities (170,731) (41,424) (150,133) (362,288)
Non-current assets
Consolidated total intangible assets 48,772 17,675 - 66,447
Property, plant and equipment 425,717 29,430 - 455,147
Right-of-use assets 15,929 6,980 383 23,292
Total 490,418 54,085 383 544,886
Total non-current asset additions 48,915 4,991 - 53,906
Included within revenue for the year ended 31 December 2025 were £2.5 million
of bill and hold transactions in the Clay Division and £0.1 million in
Concrete Division. At 31 December 2025, £2.4 million of inventory relating to
bill and hold transactions remained on the Clay Division's premises and £0.2
million on the Concrete Division's premises.
In 2025, the Group has disposed of its Roofing business in the Concrete
Segment, as it does not represent a major line of business for the Group and
also the disposal does not impact the geographical operations for the Group,
it has not been classified as a discontinued operation.
The unallocated segment balance includes the fair value of the Group's
share-based payments and associated taxes (£0.5 million), plc Board and other
plc employment costs (£6.0 million), pension costs (£1.2 million) and
legal/administrative expenses (£3.2 million) These costs have been offset by
research and development taxation credits (£4.6 million). During the current
period, two customers accounted for greater than 10% of Group revenues with
£95.0 million of sales across the Clay and Concrete divisions.
Year ended
31 December 2024
Clay Concrete Unallocated & Total
elimination
£'000 £'000 £'000 £'000
Total revenue 248,764 117,443 - 366,207
Adjusted EBITDA 72,287 14,646 (7,583) 79,350
Adjusted EBITDA margin 29.1% 12.5% 21.7%
Exceptional items impacting operating profit (see Note 5) (11,336) (384) - (11,720)
Depreciation and amortisation pre fair value uplift (24,188) (5,446) (144) (29,778)
Incremental depreciation and amortisation following fair value uplift (5,926) (4,853) - (10,779)
Net finance costs (1,303) (509) (4,581) (6,393)
Profit/(loss) before tax 29,534 3,454 (12,308) 20,680
Taxation (5,588)
Profit for the year 15,092
Consolidated total assets 611,544 127,371 13,190 752,105
Consolidated total liabilities (168,917) (48,023) (139,902) (356,842)
Non-current assets
Consolidated total intangible assets 52,649 21,301 - 73,950
Property, plant and equipment 411,111 51,393 - 462,504
Right-of-use assets 19,300 8,541 522 28,363
Total 483,060 81,235 522 564,817
Total non-current asset additions 49,381 4,050 - 53,431
Included within revenue for the year ended 31 December 2024 were £0.1 million
of bill and hold transactions in the Concrete Division. At 31 December 2024,
£0.1 million of inventory relating to these bill and hold transactions
remained on the Concrete Division's premises. Additionally, £0.1 million of
inventory related to bill and hold sales in previous years remained on the
Concrete Division's premises and £0.4 million on the Clay Division's
premises.
The unallocated segment balance includes the fair value of the Group's
share-based payments and associated taxes (£1.5 million), plc Board and other
plc employment costs (£5.2 million), pension costs (£1.0 million) and
legal/administrative expenses (£3.6 million) These costs have been offset by
research and development taxation credits (£2.6 million) and segmental
recharges (£1.1 million). During the current period, one customer accounted
for greater than 10% of Group revenues with £55.7 million of sales across the
Clay and Concrete divisions.
5. EXCEPTIONAL ITEMS
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Exceptional cost of sales
Impairment charge - Property, plant and equipment (6,141) (1,126)
Impairment charge - Right-of-use assets (195) (2,706)
Total impairment charge (6,336) (3,832)
Write- off of inventory (2,408) -
Redundancy costs (1,904) (581)
Other costs associated with site closure (1,135) (5,358)
Total exceptional cost of sales (11,783) (9,771)
Exceptional administrative expenses:
Redundancy costs (2,239) (992)
Other costs associated with site closure (3,699) (957)
Total exceptional administrative expenses (5,938) (1,949)
Exceptional net loss on disposal of business and fixed assets (1,757) -
Exceptional items impacting operating profit (19,478) (11,720)
Total exceptional items (19,478) (11,720)
In the second half of 2025, the Group announced a restructuring programme in
response to weaker than expected market volumes and adverse pricing dynamics,
together with revised industry forecasts signalling a prolonged downturn in
construction and RMI activity.
Unlike the 2023 enterprise wide restructuring programme, which responded to
broad based softening in market demand, and the 2024 restructuring focused
specifically on the Glass Reinforced Concrete (GRC) business, the 2025
programme is targeted at rationalising the organisational cost base,
streamlining operational overheads, and optimising the Group's manufacturing
footprint to more appropriately align capacity with projected demand levels.
Because the total financial impact of each coordinated programme or activity
exceeded the Group's quantitative threshold for exceptional items, and due to
their non-recurring nature, the associated financial impact has been presented
as an exceptional item.
During the 2025 year, the total exceptional charge arising from the
restructuring programmes initiated in the prior periods was £4.7 million
(cash paid: £4.2 million), while the total charge arising from the enterprise
restructuring programme initiated in 2025 was £13.1 million (cash paid: £0.9
million).
2025
Included within the current year are the following exceptional items:
Exceptional cost of sales
Impairment charges arising in the current year relate to the impairment of
non-current assets as set out in Note 10. Due to the materiality and
non-recurring nature, these costs have been categorised as exceptional.
Redundancy costs relate to the severance for employees engaged in production
activities following the Group's announced restructuring activities. These
costs have been categorised as exceptional due to their materiality, and
unusual and non-recurring nature of the events giving rise to the costs.
Write-off of inventory relate to write-off of non-best soft‑mud brick
products identified through the production‑footprint rationalisation
undertaken as part of the 2025 restructuring, and write-off of certain
inventories related to proposed close and mothball sites, as the net
realisable value is £nil.
Other costs associated with site closure relate to other costs incurred as a
result of the Group's restructuring decisions during the current and prior
year. These incremental costs include closed site security and decommissioning
activities.
Exceptional administration expenses
Exceptional redundancy costs arising in the current period relate to costs of
redundancy of employees within the Group's selling, general and administrative
("SG&A") functions associate with the Group's restructuring announced in
second half of 2025.
Other costs associated with closure of site relate to other SG&A costs
directly attributable to the Group's restructuring decision in 2025 and
cessation of the GRC business announced in October 2024.
The costs have been treated as exceptional due to their materiality, and the
unusual and non-recurring nature of the event giving rise to the costs.
Exceptional loss on disposal of tangible assets
In 2025, the Group disposed of its Roofing business at the Concrete segment,
resulting in a total loss of £6.3 million. This loss was partially offset by
a gain of £4.5 million from the sale and leaseback of the Bedford site, also
within the Concrete segment. The current operations on the Bedford site will
not change in the foreseeable future.
Given their material financial impact and non recurring nature, the net loss
arising from these asset disposals has been presented as an exceptional item.
The current operation on the Bedford site will not change in the foreseeable
future.
During the year, the Group also realised proceeds from the disposal of several
surplus land assets. None of the individual transactions exceeded the Group's
quantitative threshold for exceptional items, therefore, the aggregate profit
on disposal of £2.0 million has been presented within underlying operating
profit.
2024
Included within the year were the following exceptional items:
Exceptional cost of sales
Impairment charges arising in the year related to the impairment of
non-current assets. Due to their materiality and non-recurring nature, these
costs had been categorised as exceptional.
Redundancy costs related to the severance for employees engaged in production
activities following the Group's announced restructuring activities. These
costs had been categorised as exceptional due to their materiality, and
unusual and non-recurring nature of the events giving rise to the costs.
Costs associated with the closure of sites relate to other costs incurred as
part of its single co-ordinated plan arising as a result of the Group's
restructuring decisions in prior year. These costs mainly include closed site
security and decommissioning activities.
Exceptional administration expenses
Exceptional redundancy costs arising in the period relate to costs of
redundancy of employees within the Group's selling, general and administrative
("SG&A") functions following the Group's restructuring announced in
October 2023 and the GRC closure announced in October 2024.
The costs had been treated as exceptional due to their materiality, and the
unusual and non-recurring nature of the event giving rise to the costs.
Other costs associated with closure of site relate to other SG&A costs
directly attributable to the Group's cessation of the GRC business announced
in October 2024.
Cash flow on exceptional items(1)
In relation to the exceptional tangible asset disposals, total cash proceeds
of £31.2 million were received in 2025.
Operating exceptional cash cost of £7.4 million (2024: £8.1 million)
associated with the Group's 2025 restructuring programme, decommissioning
activities and other costs associated with previously closed sites as well as
costs directly arising from our decision to close the GRC business. Total
related cash outflow of £ 5.1 million in relation to operating exceptional
items in 2025 (2024: £11.2 million) comprised £3.9 million relating to
in-year exceptional charges (2024: £6.8 million) and the settlement of
provisions within the opening balance sheet totalling £1.2 million (2024:
£4.4 million). £4.5 million cash related to the exceptional cash charges is
expected to be paid in the next financial year.
Tax on exceptional items
In the current year, impairment charges arising on non-current assets are not
tax deductible but give rise to a deferred tax credit in the period where the
assets were eligible for capital allowances. The redundancy and site closure
costs are treated as tax deductible in the period. The total tax credit on
exceptional items is £7.5 million (2024: £2.9 million).
6. TAXATION
Year ended 31 December 2025 Total Percentage Exceptional and other adjusting items Percentage Adjusted PBT Percentage
statutory £'000 £'000
£'000
Profit before tax 896 100% 29,307 100% 30,203 100%
Profit before tax multiplied by the rate of corporation tax in the UK 224 25.00% 7,327 25.00% 7,551 25.00%
Effects of:
Expenses not deductible / items not taxable (2,011) (224.39%) 2,557 8.72% 546 1.81%
Changes in estimates relating to prior periods (391) (43.64%) (391) (1.29%)
Total taxation expense from continuing operations (2,178) (243.03%) 9,884 33.72% 7,706 25.52%
Year ended 31 December 2024 Total statutory Percentage Exceptional Percentage Adjusted Percentage
£'000 and other PBT
adjusting £'000
items
£'000
Profit before tax 20,680 100% 20,280 100% 40,960 100%
Profit before tax multiplied by the rate of corporation tax in the UK 5,170 25.00% 5,070 25.00% 10,240 25.00%
Effects of:
Expenses not deductible / items not taxable 967 4.68% - - 967 2.36%
Permanent benefit of super-deduction on capital expenditure - - - - - -
Changes in estimates relating to prior periods (549) (2.65%) - - (549) (1.34%)
Rate change on deferred tax provision - - - - - -
Total taxation expense from continuing operations 5,588 27.03% 5,070 25.00% 10,658 26.02%
7. EARNINGS PER SHARE
The basic earnings per share figures are calculated by dividing profit for the
year attributable to the parent shareholders by the weighted average number of
Ordinary Shares in issue during the year. The diluted earnings per share
figures allow for the dilutive effect of the conversion into Ordinary Shares
of the weighted average number of options outstanding during the year. Where
the average share price for the year is lower than the option price the
options become anti-dilutive and are excluded from the calculation. The number
of shares used for the earnings per share calculation are as follows:
Year ended Year ended
31 December 31 December
2025 2024
(000s) (000s)
Basic weighted average number of Ordinary Shares 394,453 393,091
Effect of share incentive awards and options 6,112 3,372
Diluted weighted average number of Ordinary Shares 400,565 396,463
The calculation of adjusted earnings per share is a key measurement used by
management that is not defined by IFRS. The adjusted earnings per share
measures should not be viewed in isolation but rather treated as supplementary
information.
Adjusted earnings per share figures are calculated as the Basic earnings per
share adjusted for exceptional items, and fair value adjustments (being the
amortisation and depreciation on fair value uplifted assets and non-cash
interest expenses). Adjustments are made net of the associated taxation on the
adjusted items. A reconciliation of the statutory profit to that used in the
adjusted earnings per share(1) calculations is as follows:
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Profit for the period attributable to the parent shareholders 3,074 15,092
Add back exceptional items (Note 5) 19,478 11,720
Less back tax credit on exceptional items (7,501) (2,930)
Incremental depreciation and amortisation following fair value uplift 10,236 10,779
Less tax credit on incremental depreciation and amortisation following fair (2,559) (2,695)
value uplift
Less net non-cash interest (407) (2,219)
Add back tax expense on non-cash interest 102 555
Adjusted profit for the period attributable to the parent shareholders 22,423 30,302
Year ended Year ended
31 December 31 December
2025 2024
pence pence
Basic EPS on profit for the year 0.8 3.8
Diluted EPS on profit for the year 0.8 3.8
Adjusted basic EPS on profit for the year 5.7 7.7
Adjusted diluted EPS on profit for the year 5.6 7.6
8. BORROWINGS
31 December 2025 31 December 2024
£'000 £'000
Current
Private Placement 339 339
Revolving Credit Facility 40,813 31,086
41,152 31,425
Non-current
Private Placement 99,862 99,427
99,862 99,427
Total borrowings 141,014 130,852
At current and prior year end, the Group held £100 million of private
placement notes from PRICOA Private Capital, with maturities of between 2028
and 2033 and an average total cost of funds of 2.19% (range 2.04% - 2.27%).
The agreement contains debt covenant requirements of leverage (net debt to
adjusted EBITDA) and interest cover (adjusted EBITDA to net finance charges)
of no more than 3 times and at least 4 times, respectively, tested
semi-annually on 30 June and 31 December in respect of the preceding 12-month
period.
Additionally, the Group renewed the £125 million RCF facility in the year, of
which is held with a syndicate of four banks for an initial four-year period
ending in November 2029 with one -year extension option. Interest is charged
at a margin (depending upon the ratio of net debt to Adjusted EBITDA) of
between 160bps and 260bps above SONIA, SOFR or EURIBOR according to the
currency of the borrowing. The facility also includes an additional £50
million uncommitted accordion facility. Based on current leverage, the Group
will pay interest under the RCF initially at a margin of 255 bps. This
facility contains debt covenant requirements that align with those of the
private placement with the same testing frequency. As at 31 December 2025 the
RCF was drawn down by £42.0 million (2024: £31.0 million).
The carrying values of financial liabilities have been assessed as materially
in line with their fair values, with the exception of £100 million of private
placement notes. The fair value of these borrowings has been assessed as
£90.1 million (2024: £87.8 million).
No security is provided over the Group's borrowings.
9. PROVISIONS
31 December 2025 31 December 2024
£'000 £'000
Restoration (i) 4,795 4,405
Dilapidations (ii) 4,646 3,816
Restructuring (iii) 3,357 1,397
Other (iv) 789 419
13,587 10,037
Current 5,595 3,010
Non-current 7,992 7,027
13,587 10,037
(i) The restoration provision comprises obligations governing site remediation
and improvement costs to be incurred in compliance with applicable
environmental regulations together with constructive obligations stemming from
established practice once the sites have been fully utilised. Provisions are
based upon management's best estimate of the ultimate cash outflows. The key
estimates associated with calculating the provision relate to the cost per
acre to perform the necessary remediation work as at the reporting date
together with determining the expected year of retirement. Climate change is
specifically considered at the planning stage of developments when restoration
provisions are initially estimated. This includes projection of costs
associated with future water management requirements and the form of the
ultimate expected restoration activity. Other changes to legislation,
including in relation to climate change, are factored into the provisions when
legislation becomes enacted. Estimates are reviewed and updated annually based
on the total estimated available reserves and the expected mineral extraction
rates. Whilst an element of the total provision will reverse in the
medium-term (one to ten years), the majority of the legal and constructive
obligations applicable to mineral-bearing land will unwind over a greater than
twenty-year timeframe. In discounting the related obligations, expected future
cash outflows have been determined with due regard to extraction status and
anticipated remaining life. Discount rates used are based upon UK Government
bond rates with similar maturities.
(ii) Provisions for dilapidations are recognised on a lease-by-lease basis and
are based on the Group's best estimate of the likely contractual cash
outflows, which are estimated to occur over the lease term. Third party
valuation experts are used periodically in the determination of the best
estimate of the contractual obligation, with expected cash flows discounted
based upon UK Government bond rates with similar maturities. The legal and
constructive obligation will unwind over one to fifty years.
(iii) The restructuring provision comprised obligations arising from the
Group's restructuring programmes (see further details in Note 5). The
restructuring provisions mainly related to the site closures and redundancy
costs. The key estimates associated with the provision relate to redundancy
costs per impacted employee. All of the cost is expected to be incurred within
one year of the balance sheet date.
(iv) Other provisions include provisions for legal and warranty claim costs,
which are expected to be incurred within one year of the balance sheet date.
10. IMPAIRMENT
In the year, in light of the lower activity levels across the UK construction
industry, management identified indicators of potential impairment.
Subsequently recoverable amounts across the Group's cash-generating units
(CGUs) were calculated and compared with the carrying value of the assets that
were allocated to the relevant CGUs.
For tangible asset impairment testing purposes, the Group has determined that
each factory is a separate Cash Generating Unit (CGU), except for Bedford and
Barnwell which are considered as one Southern fencing and building CGU in the
Concrete Segment. In 2025, the Group disposed the Roofing CGU.
For impairment testing of intangible assets such as brands, customer
relationships and goodwill, CGUs are grouped at the legal entity level, as
this is the lowest level that cash inflows generated from these assets can be
identified.
Following announcement of the 2025 restructuring, in the Clay segment,
management performed detailed impairment testing for the carrying value of the
assets associated with the sites that will cease production permanently, being
Gatwick and Stowmarket.
The Group determined the recoverable amount based on the fair value less costs
to disposal ("FVLCTD"). This assessment falls within level 3 of the fair value
hierarchy and was based on management's judgement that the assets could not be
sold for any value, this being the assumption the recoverable amount is most
sensitive to.
Determination of FVLCTD by management reflected full impairment of all items
of plant and machinery, building improvement, right-of-use (ROU) assets for
which management's assessment was that no alternative use, future salvage
value or disposal proceeds are expected for the impacted assets. This led to
an impairment charge of £0.3m.
Additionally, management completed detailed impairment testing based on
value-in-use ("VIU"), for the Group's other operating CGUs as at 31 December
2025.
The key assumptions used within the VIU calculation are noted below:
Management has used the latest Board approved budget and strategic planning
forecasts in its estimated future cash flows, covering the period 2026 to
2030, which includes assumptions regarding industry demand for the Group's
products. These forecasts assume a return to normalised levels of industry
demand for the Group's products (defined as a level of demand in line with the
2022 year) over the medium term.
For the CGUs within the clay segment, management has identified a downside
risk: an unforeseen, structural decline of more than 15% in management's
forecast for long-term demand for the Group's brick products, benchmarked
against demand levels experienced in five of the past ten years. Should this
occur, the Group might make the decision to close or mothball certain CGUs,
potentially leading to an impairment of property, plant and equipment up to
£40 million. The final impairment charge would be influenced by management's
strategic response to the altered market demand and product mix.
The other assumptions used within the VIU calculation are noted below:
1. A pre-tax weighted average cost of capital ("WACC") of 11%-21% was used within
the VIU calculation based on an externally derived rate and benchmarked
against industry peer group companies.
2. Terminal nominal growth rates of 2% were used reflecting long term
inflationary expectations and management's past experience and expectations.
Management is of the view that no reasonable movement in the assumptions of
the WACC or terminal growth rate outlined would result a material impairment
of the Group's non-current assets. Management do not deem there to be any
reasonably possible changes in the next 12 months that would cause a material
impairment in any of the CGUs of the concrete segment.
The cash flows include ongoing capital expenditure required to maintain the
productive capacity of the network but exclude any growth capital initiatives
not committed.
The immediately quantifiable impacts of climate change and costs expected to
be incurred in connection with our climate resilience plan, are included
within the budget and strategic plan, which have been used to support the
impairment reviews, with no material impact on cash flows. We also expect any
changes required due to physical risks arising from our assessment of climate
change would be covered by business-as-usual site refurbishments and phased
over multiple years. Therefore, the related cash outflow would not have a
material impact in any given year. As a consequence, there has been no
material impact on the forecast cash flows used for impairment testing.
As a result of the detailed impairment testing performed as at 31 December
2025 a further impairment of £6.0 million was identified at the Leicester
site factory, which will be temporarily closed from April 2026, with a
recoverable value of £17.6 million. The identified impairment was
proportionally allocated to the building, mineral reserves and plant machinery
and equipment assets.
The impairment of assets valued at historical cost impacted the Clay segment
of the Group in the current period as follows:
Clay
£'000
Buildings 2,071
Mineral reserves 360
Plant, machinery and equipment 3710
Right-of-use assets 195
Total 6,336
No further impairment charges were recognised in other CGUs and no impairment
reversals arose during the year.
Goodwill and other intangibles
Goodwill and other intangibles are reviewed annually for impairment.
Recoverability is assessed by comparing the carrying amount of the intangible
assets and the CGUs/group of CGUs that derive benefit from the assets with the
expected recoverable amount determined on a value-in-use basis. See below for
a summary of which legal entities the Group's goodwill and other intangibles
are allocated to:
CGU or group of CGUs 31 December 2025 31 December 2024
£'000 £'000
Goodwill:
Longley (Concrete segment) 2,964 2,964
Generix (Clay segment) 888 888
Coltman (Concrete segment) 38 38
3,890 3,890
Other intangibles
Ibstock Brick (Clay segment) 47,604 52,216
Generix (Clay segment) 652 -
Forticrete (Concrete segment) - 140
Supreme (Concrete segment) 11,640 14,432
Longley (Concrete segment) 2,661 3,272
62,557 70,060
Management is of the view that no reasonably possible change could cause
impairment of goodwill or other intangibles due to the significant headroom at
a legal entity level
Key assumptions used within the testing are consistent with those set out
above. No impairment was indicated.
For the Longley CGU, a pre-tax discount rate of 12.31% has been used, together
with a long-term growth rate of 2%. CGU-specific cash flows for the detailed
five-year time period used by management contain a revenue compound growth
rate of 7.8%.
Based on management's projections, no reasonably possible change in key
assumptions within the VIU calculation supporting the impairment calculation
could cause the carrying value of goodwill and other intangibles to exceed its
recoverable amount.
11. NOTES TO THE GROUP CASH FLOW STATEMENT
Year ended Year ended
31 December 31 December
2025 2024
Cash flows from operating activities £'000 £'000
Profit before taxation 896 20,680
Adjustments for:
Depreciation 35,210 33,495
Impairment of property plant and equipment 6,141 1,126
Impairment of right-of-use assets 195 2,706
Impairment of working capital 2,408 -
Amortisation of intangible assets 6,322 7,062
Net finance costs 9,138 6,393
Gain on disposal of property, plant and equipment (178) (261)
Research and development expenditure credit (3,927) (2,635)
Share based payments 484 1,253
Post-employment benefits 1,247 959
Other - (245)
57,936 70,533
Increase in inventory (24,196) (5,633)
Decrease/(increase) in debtors 10,329 (5,529)
Increase in creditors 1,415 8,355
Increase/(decrease) in provisions 2,551 (4,820)
Cash generated from operations 48,035 62,906
12. FINANCIAL INSTRUMENTS
IFRS 13 'Financial Instruments: Disclosures' requires fair value measurements
to be recognised using a fair value hierarchy that reflects the significance
of the inputs used in the measurements, according to the following levels:
Level 1 - Unadjusted quoted prices in active markets for identical assets or
liabilities.
Level 2 - Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (that is, as prices) or
indirectly (that is, derived from prices).
Level 3 - Inputs for the asset or liability that are not based on observable
market data (that is, unobservable inputs).
At 31 December 2025 and 31 December 2024, the Group's fair value measurements
were categorised as Level 2, except for (i) quoted investments within the
Group's pension schemes, which were valued as Level 1 and (ii) the insured
pensioner and deferred pensioner asset, which was categorised as a Level 3
valuation and uses assumptions set out in Note 13 to align its valuation to
the related liability.
The Group entered into forward currency contracts as cash flow hedges to
manage its exposure to foreign currency fluctuations associated with the
future purchases of plant and equipment required for the construction of major
capital expenditure projects. These instruments are measured at fair value
using Level 2 valuation techniques subsequent to initial recognition.
At 31 December 2025, no derivative financial instrument was recognised (31
December 2024: a liability of £0.1 million).
At 31 December 2025 and 31 December 2024, the Group held no other significant
derivative financial instruments. There were no transfers between levels
during any period disclosed.
The carrying value of the Group's short-term receivables and payables is a
reasonable approximation of their fair values. The fair value of all other
financial instruments carried within the Group's financial statements is not
materially different from their carrying amount, with the exception of £100
million of private placement notes. The fair value of these borrowings has
been assessed as £90.1 million (2024: £87.8 million).
13. POST EMPLOYMENT BENEFITS
The Group participates in the Ibstock Pension Scheme (the 'Scheme'), a defined
benefit pension scheme in the UK. During the year ended 31 December 2025, the
opening Scheme surplus of £7.8 million decreased to a closing surplus of
£6.0 million. Analysis of the movements during the year ended 31 December
2025 was as follows:
£'000
Scheme surplus at 31 December 2024 7,839
Charge within labour costs and operating profit (1,247)
Interest income 394
Remeasurement due to:
- Change in financial assumptions 7,665
- Change in demographic assumptions (2,892)
- Experience gains (2,658)
- Return on plan assets (3,117)
Scheme surplus at 31 December 2025 5,984
On 20 December 2022, the Scheme completed a full buy-in transaction with a
specialist third-party provider, which represented a significant step in the
Group's continuing strategy of de-risking its pensions exposure. This
transaction, together with the partial buy-in transaction in 2020 insured the
significant majority of the Group's defined benefit liabilities. As a result,
the insured asset and the corresponding liabilities of the Scheme are assumed
to be broadly matched without exposure to interest rate, inflation risk or
longevity risk. However, there is a residual risk that the insurance premium
may be increased following a data cleanse to reflect a more accurate liability
position. If the surplus Scheme assets are insufficient to meet any additional
premium, then the company may need to pay an additional contribution into the
Scheme.
The financial assumptions used by the actuary have been derived using a
methodology consistent with the approach used to prepare the accounting
disclosures at 31 December 2024. The assumptions have been updated based on
market conditions at 31 December 2025:
Year ended Year ended
31 December 31 December
2025 2024
Per annum Per annum
Discount rate 5.50% 5.45%
RPI inflation 2.95% 3.25%
CPI inflation 2.50% 2.75%
Rate of increase in pensions in payment 3.50% 3.65%
Commutation factors 19.30 19.50
Mortality assumptions: life expectancy from age 65
For a male currently aged 65 21.7 years 21.4 years
For a female currently aged 65 24.3 years 24.2 years
For a male currently aged 40 23.5 years 23.1 years
For a female currently aged 40 26.0 years 26.0 years
In light of the fact that the pension scheme was in a net surplus position
after the full buy-in, on 27 February 2023 the Trustees and the Group agreed
that the Group would suspend paying regular contributions with effect from 1
March 2023. The schedule of contributions was reviewed again as part of the
30 November 2023 actuarial valuation, and as the net surplus position remained
unchanged, no further contributions were required.
14. OTHER RESERVES
Cash flow hedging reserve Merger reserve Own shares held Treasury shares Total other reserves
£'000 £'000 £'000 £'000 £'000
Balance at 1 January 2025 (65) (369,119) - (27,907) (397,091)
Other comprehensive expense 44 - - - 44
Issue of own shares held on exercise of share options - - - 1,193 1,193
At 31 December 2025 (21) (369,119) - (26,714) (395,854)
Balance at 1 January 2024 (25) (369,119) (514) (30,000) (399,658)
Other comprehensive income (40) - - - (40)
Issue of own shares held on exercise of share options - - 514 2,093 2,607
At 31 December 2024 (65) (369,119) - (27,907) (397,091)
Cash flow hedging reserve
The cash flow hedging reserve records movements for effective cash flow hedges
measured at fair value. The accumulated balance in the cash flow hedging
reserve will be reclassified to the cost of the designated hedged item in a
future period.
Merger reserve
The merger reserve of £369.1 million arose on the acquisition of Figgs Topco
Limited by Ibstock plc in the period ended 31 December 2015 and is the
difference between the share capital and share premium of Figgs Topco Limited
and the nominal value of the investment and preference shares in Figgs Topco
Limited acquired by the Company.
Own shares held
The Group's holding in its own equity instruments is shown as a deduction from
shareholders' equity at cost. These shares represented shares held in the
Employee Benefit Trust (EBT) to meet the future requirements of the employee
share-based payment plans. Consideration, if any, received for the sale of
such shares is also recognised in equity with any difference between the
proceeds from sale and the original cost being taken to the profit and loss
reserve. No gain or loss is recognised in the income statement on the
purchase, sale, issue or cancellation of equity shares. All shares held in EBT
were issued to meet share option requirements in 2024.
Treasury share reserve
The Group holds treasury shares to meet the future requirements of employee
share-based payment plans. Consideration, if any, received for the sale of
such shares is also recognised in equity with any difference between the
proceeds from sale and the original cost being taken to the profit and loss
reserve. No gain or loss is recognised in the income statement on the
purchase, sale, issue or cancellation of equity shares.
At 31 December 2025, the treasury shares are shown as a deduction from
shareholders' equity at cost totalling £26.7 million (31 December 2024:
£27.9 million).
15. RELATED PARTY TRANSACTIONS
Balances and transactions between Ibstock Plc (the ultimate Parent) and its
subsidiaries, which are related parties, are eliminated on consolidation and
are not disclosed in this note. There were no further material related party
transactions, nor any related party balances in either the 2025 or 2024
financial year other than remuneration for the Directors and key management
personnel.
16. DIVIDENDS PAID AND PROPOSED
The Directors are proposing a final dividend in respect of the financial year
ended 31 December 2025 of 1.5 pence (2024: 2.5 pence) per Ordinary Share,
which will distribute an estimated £5.9 million (2024: £9.9 million) of
shareholders' funds. Subject to approval at the Annual General Meeting, this
will be paid on 29 May 2026, to shareholders on the register at the close of
business on 8 May 2026.
These condensed consolidated financial statements do not reflect the 2025
final dividend declared.
17. POST BALANCE SHEET EVENTS
Except for the proposed ordinary dividend (see Note 16), no further subsequent
events requiring either disclosure or adjustment to these financial statements
have arisen since the balance sheet date.
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