REG - Michelmersh Brick - Half Year Results
Tue 07:00
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RNS Number : 5497X Michelmersh Brick Holdings PLC 02 September 2025
2 September 2025
Michelmersh Brick Holdings PLC
("MBH", the "Company", or the "Group")
Half year results for the six months ended 30 June 2025
Michelmersh Brick Holdings PLC (AIM: MBH), the specialist brick manufacturer
and brick-fabricator, is pleased to report its half year results for the six
months ended 30 June 2025.
Financial Highlights:
30 June 2025 30 June 2024 Change
Statutory results
Revenue £35.8m £35.4m 1.1%
Gross margin 33.6% 36.2% (2.6%)
Operating profit £3.0m £4.1m (26.8%)
Profit before tax £2.9m £4.1m (29.3%)
Basic earnings per share 2.47p 3.37p (26.7%)
Cash from operations £3.2m £0.9m up £2.3m
Net cash £1.5m £4.1m down £2.6m
Dividend per share 1.60p 1.60p -
Adjusted results*
Adjusted EBITDA(1) £5.9m £7.2m (18.1%)
Adjusted operating profit £4.0m £5.3m (24.5%)
Adjusted profit before tax £3.9m £5.3m (26.4%)
Adjusted earnings per share 3.30p 4.28p (22.9%)
Strategic and Operational Highlights:
· Resilient first half of 2025, with revenue up 1.1% reflecting
increased UK despatch volumes offset by very challenging markets in Europe
· Continued outperformance of UK market despatch volumes, which remain
c. 25% below 2022 peak; a result of the diversity of our end markets and the
quality of our products
· Order intake ahead of normalised manufacturing volumes in H1,
underpinning a balanced order book profile for the start of H2
· Highly competitive pricing environment mitigated by a continued
focus on collaboration with customers to support stable average selling prices
· H1 weighted capex investment of £3.8 million targeting
efficiency improvements across manufacturing facilities
· Additional two-week shutdown at Carlton in January completed a
substantial capex programme leading to a three million unit shortfall on the
site and a one-off impact on profits in H1; normalised operating cadence
re-established in H2
· Challenging market conditions in Belgium with a further 20% decline
in housing activity from 2024 led to significant drop in revenue and
despatches in Floren; cost reductions realised in order to mitigate current
market activity levels
· Active management of input costs on a risk-based approach, with
energy costs continuing to be hedged
· Strong balance sheet despite challenging markets, with net cash of
£1.5 million and £20 million borrowing facility underpinning financial
resilience and flexibility to pursue balanced capital allocation policy
· Declaration of interim dividend of 1.60 pence (1.60 pence H124)
underlines the Board's confidence in the outlook of the business and its focus
on the importance of returns for shareholders
· Peter Sharp steps down from the Board as CEO to become industry
adviser, with Ryan Mahoney formally acceding to the role of CEO as Peter's
replacement
· Rachel Warren joins the Board as the new CFO from Wincanton
Outlook
· Resilient momentum in our order intake, continuing to run ahead
of manufacturing volumes
· Focus on maintaining a well-balanced forward order book and
appropriate pricing in a very competitive market to support demand across our
diverse end market customer base
· Decision taken to temporarily stop production at Floren in Q3 due
to slow recovery in Belgium market with production expected to restart in Q4
· Continued execution of our balanced capital allocation policy
focused on maintaining well invested manufacturing sites and balanced returns
to shareholders through dividends and buybacks
· Despite the inflection point for market recovery remaining
uncertain, the medium term fundamental market drivers for our business are
encouraging and we are well positioned
· With improved trading continuing into H2, the Board expect the full
year outturn for FY25 to be broadly reflective of our FY24 financial
performance
Commenting on the results, Tony Morris, Chair of Michelmersh Brick Holdings
PLC, said:
"The timing uncertainty in the recovery of the wider UK construction industry
and Belgium brick markets continues to challenge the Group. UK brick
despatches remain c. 25% below the peak in 2022, whilst Belgium is some 40%
below over the same period. Despite this, the Group continues to outperform
the UK market in despatch volumes. Our fundamental core competency remains our
significant strength in the premium end of the brick market in the UK and
Benelux addressing a broad and diverse end user base.
"Given the scale of the investment to improve the production efficiency across
our facilities over the last 12 months, the additional two-week shutdown at
Carlton has impacted our profit metrics in the first half. As we move into the
second half of the year, we are now seeing a normalised operational cadence in
the UK which is supporting our commercial focus on maintaining momentum in our
order intake and balanced order book. With the strength of our balance sheet
and net cash position, we are positioned well to continue to trade through the
ongoing challenging market conditions but we do not expect to recover the
profit shortfall in the second half. As a result, and given the in trading we
are seeing in H2, we expect our full year performance to be now broadly in
line with FY24 before returning to growth in 2026."
(*) The Directors believe that adjusted measures provide a more useful
comparison of business trends and performance. Adjusted results exclude
exceptional items, costs associated with acquisitions and aborted corporate
transactions, and the amortisation of acquired intangibles. The term adjusted
is not defined under IFRS and may not be comparable with similarly titled
measures used by other companies. (.)Adjusted performance results are
reconciled with these reported results in the Chief Executive Officer's
Statement below.
(1) EBITDA is defined as earnings before interest, tax, depreciation and
amortisation.(.)
An analyst briefing will be held virtually at 09:30am today. To attend, please
email michelmersh@yellowjerseypr.com (mailto:michelmersh@yellowjerseypr.com) .
The Company also notes that it will be hosting an online presentation
to retail investors at 14:00 pm today. Those wishing to join the
presentation are requested to register via the following link: https:/
/engageinvestor .news/MBH_IP.
(https://www.engageinvestor.com/event/68a44d1cdee5139143b0c2a1)
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET
ABUSE REGULATION (EU NO. 596/2014) AS IT FORMS PART OF UK DOMESTIC LAW BY
VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018.
Michelmersh Brick Holdings PLC Tel: +44 (0) 1825 430 412
Ryan Mahoney, Chief Executive Officer
Rachel Warren, Chief Financial Officer
Canaccord Genuity Limited (NOMAD and Broker) Tel: +44 (0) 20 7523 8000
Max Hartley
Bobbie Hilliam
Harry Pardoe
Yellow Jersey PR Tel: +44 (0) 7747 788 221
Charles Goodwin Tel: +44 (0) 7775 194 357
Annabelle Wills
About Michelmersh Brick Holdings PLC:
Michelmersh Brick Holdings PLC is a business with seven market leading brands:
Blockleys, Carlton, FabSpeed, Freshfield Lane, Michelmersh, Floren.be and
Hathern Terra Cotta. These divisions operate within a fully integrated
business, combining the production of premium, precision-made bricks, pavers,
special shaped bricks, bespoke Terra Cotta products and prefabricated brick
components. The Group also includes a landfill operator, New Acres Limited,
and seeks to develop future landfill and development opportunities on
ancillary land assets.
Established in 1997, the Company has grown through acquisition and organic
growth into a profitable and asset rich business, producing over 120 million
clay bricks and pavers per annum. Michelmersh currently owns most of
the UK's premium manufacturing brick brands and is a leading specification
brick and clay paving manufacturer.
Michelmersh strives to be a well invested, long term, sustainable,
environmentally responsible business. Opportunity, training and security for
all employees, whilst meeting the needs of stakeholders are at the forefront
of everything we do. We aim to lead the way in producing some
of Britain's premium clay products and enhancing our environment by adding
value to the architectural landscape for generations to come.
We are Michelmersh Brick Holdings PLC: we are "Britain's Brick Specialist".
Please visit the Group's websites at: www.mbhplc.co.uk
(http://www.mbhplc.co.uk) , www.bimbricks.com (http://www.bimbricks.com)
and www.sustainablebrick.com (http://www.sustainablebrick.com/)
Chief Executive Officer's Statement
I am pleased to report on a resilient start to our 2025 financial year and
provide details on our progress against our strategic objectives. These half
year results have been delivered in what remains a very challenging
environment across the construction industry. The cautionary sentiment of the
overall economic environment, no new Help to Buy initiatives to alleviate
affordability concerns and the unhurried reduction of interest rates have
acted as a combined drag on consumer confidence, impacting demand across our
key markets. Alongside this, low planning approvals process, particularly in
London and the South East as a result of the Building Safety Act and the
Gateway 2 and 3 regulations, has significantly impacted the recovery momentum
in some of our key markets most noticeably in the developer space. As ever,
the Board is hugely grateful for the work and dedication of all our people
across the Group. Through the last six months, the team has overseen
significant capital improvement activities whilst continuing to focus on high
quality product manufacturing and customer service.
Whilst the ongoing challenges in our sector are set to stretch beyond two
years, the fundamentals in our end markets in the UK and Belgium remain
positive. There is a critical shortage of both new residential and social
housing, a significant legacy housing inventory constructed with brick facades
underpinning future Repairs, Maintenance and Improvement ("RMI") demand, and
requirements for specification and brick-cladding remedial solutions. The UK
Government is still committed to reversing the decades long decline in housing
formations with positive statements targeting a greater than 300,000 new homes
run rate at the point of exit from this current parliament in 2029. In
Belgium, the Government is targeting 70,000 new homes a year to reverse
their critical housing shortages, which is set against a historic run rate of
65,000. Our strategic approach remains unchanged by focusing on targeting our
broad product portfolio to address a balanced demand across each of these
segments. In our view this underpins the resilience of our business as we
focus on delivering returns for shareholders. The longevity and depth of our
customer relationships also supports this approach, and we are focused on
maintaining our partnerships by delivering an excellent product and service.
Our fundamental core competency remains our significant strength in the
premium end of the brick market in the UK and Benelux. We view the long-term
fundamentals of these markets as positive, with brick continuing to be the
façade material of choice due to its longevity, sustainable and energy
efficiency qualities, low-cost base and broad aesthetic appeal. Demand for
bricks remains c. 25% below the most recent 2022 high point with the ongoing
caution from consumers continuing the long trough in activity levels. UK brick
production capacity has been gradually brought back over the last six months.
As a result, brick production is currently running ahead of despatch volumes
and consequently inventory volumes for the sector are back above the five-year
average of c. 500 million. These market dynamics made pricing highly
competitive in the first half and we will continue to watch with caution to
see if the imbalance in supply and demand continues given the fluctuating
market conditions.
The Group's continued ability to generate operational cash underpins our
confidence to follow our capital allocation policy. This has enabled us to
invest in the projects that address our strategic objectives to improve the
sustainability of our manufacturing operations and support ongoing
improvements in production efficiency. We remain committed to and focused on
the importance of returns to shareholders through maintaining our attractive
dividend ratio. The declaration of the interim dividend for the period
underlines our confidence in the outlook for the business. We have also
supplemented our dividends with the relaunch of our share buyback programme in
April 2025. The Board will continue this activity where it determines that it
is appropriate to do so to deliver value for shareholders and represents an
attractive investment opportunity for the Company. Balancing the returns for
our shareholders through dividends and buybacks alongside ensuring we maintain
well invested manufacturing sites are central to the Group's capital
allocation priorities. This strategy leaves us well-positioned to deliver
further progress and shareholder value in the second half of 2025 and beyond.
Group Results
Financial Highlights
Half year ended Half year ended
30 June 2025 30 June 2024 Change
Revenue £35.8m £35.4m 1.1%
Gross margin 33.6% 36.2% (2.6%)
Adjusted* EBITDA(1) £5.9m £7.2m (18.1%)
Adjusted* operating profit £4.0m £5.3m (24.5%)
Operating profit £3.0m £4.1m (26.8%)
Adjusted* profit before tax £3.9m £5.3m (26.4%)
Profit before tax £2.9m £4.1m (29.3%)
Adjusted* basic earnings per share 3.30p 4.28p (22.9%)
Basic earnings per share 2.47p 3.37p (26.7%)
Dividend per share 1.60p 1.60p -
(*)The Directors believe that adjusted measures provide a more useful
comparison of business trends and performance. Adjusted results exclude
exceptional items, costs associated with acquisitions and aborted corporate
transactions, and the amortisation of acquired intangibles. The term adjusted
is not defined under IFRS and may not be comparable with similarly titled
measures used by other companies. Adjusted performance results are reconciled
with these reported results in the Chief Executive Officer's Statement below.
(1) EBITDA is defined as earnings before interest, tax, depreciation and
amortisation.
The ongoing challenges in the broader construction market and the timing of
our capital improvement works have affected the trading performance in the
business in the first half, with the Group being impacted across all of our
profit metrics.
Revenue for the six months increased by 1.1% to £35.8 million over the
equivalent period in 2024 (HY24: £35.4 million). Taking the UK separately
this performance over the first six months included a 3% increase in
despatches from the start of the period. At the same time, alongside we
continued to focus on appropriate portfolio pricing to maintain diversity in
our forward order book which supported stable average selling prices period on
period despite a very competitive pricing environment. On the continent, the
broader macro market remains very challenging with the key data point of
Belgium building permits declining again by c. 20% over the prior period
comparison which gives a cumulative shortfall of c. 42% since 2022. As a
result, our Floren despatches and revenue were significantly impacted with an
approximate 23% decline in both metrics. Due to this further significant
construction activity decline in Belgium we took the decision to temporarily
close the Floren facility at the start of Q3 with a planned reopening in Q4.
As with our other recent closures in the Group, we have prioritised our
inventory planning and manufacturing scheduling to try to ensure there is
minimal impact on the planned despatches across our Floren customer base in
both the UK and on the Continent.
The overall construction environment remains very challenging which we measure
through the sector wide UK brick despatches which are still some 25% below
their last peak in 2022. However, as we highlighted last year, we have not
seen this level of decline across the Group and we are focused on maintaining
our market share in this current environment. We see maintaining our market
position in our key end channels as an important indicator reflecting the
overall resilience of our business model. Our order intake volumes remain a
very important barometer for us and we have continued our momentum in this key
metric. This reflects the benefits of our product portfolio's broad reach and
the strong customer loyalty and distributor relationships we have across our
end markets. With order intake running ahead of normalised manufacturing
capacity across the first half, this visibility continues to support our
decision to maintain our production volumes in the UK and with no planned
capex programmes which would require any further facility downtime.
Due to the timing of our capital improvement activities in the UK and the
market challenges in Europe, our profit metrics have been negatively impacted
in the first half. Adjusted operating profit of £4.0 million was down 24.5%
on the comparative 2024 period (HY24: £5.3 million) and adjusted profit
before tax of £3.9 million was down 26.4% (HY24: £5.3 million). The extended
shutdown at Carlton by two-weeks and the subsequent commissioning period,
combined to reduce our manufacturing volumes by three million units in the
first half at this key site. This one-off impact has been the most significant
drag on our H1 profit metrics. However, we expect to see normal manufacturing
cadence continue for the rest of the year as we start to benefit from the
significant investment at Carlton.
We continue to manage our input costs on a risk-based approach and as such, we
have secured over 70% of our energy requirements for 2025. We see this as an
appropriate hedged balance as we continue to see some opportunity in the
potential for improvements in the pricing of utilities. Energy contracts are
also in place for 50% of our expected requirements in 2026 with further
contracts into 2027 and 2028 in line with this approach. Despite the one-off
challenge with Carlton in the first half of the year the Group's strategy
remains focused on managing our operational efficiency to maximise our
financial returns, whilst importantly maintaining a close relationship with
our loyal customers through our ability to deliver a greater degree of pricing
visibility.
Adjusted EBITDA of £5.9 million is lower by 18.1% against 2024 (HY24: £7.2
million). This is at a lower margin of 16.5% compared to our 2024 exit margin
of 20.0% largely reflecting the impact of our Carlton production delays and
the challenging trading at Floren.
On a reported basis, the results include the impact of the amortisation of
acquired intangibles and some exceptional items we incurred over the last 6
months. The adjustment of £0.7 million for the amortisation of intangibles is
in line with 2024. In this six-month period we have incurred exceptional items
of £0.3 million, being all related to Group restructuring costs. As a result,
operating profit of £3.0 million was 26.8% below 2024 with profit before tax
reflecting the same performance also down 29.3% at £2.9 million.
After a tax charge of £0.7 million (HY24: £1.0 million), the Group recorded
a profit for the period after tax of £2.3 million (HY24: £3.1 million). The
tax rate of 22.3% (HY24: 24.5%) reflects our expected effective Group tax rate
for the full year, which is broadly inline with our effective rate of tax from
the 2024 financial year.
Basic earnings per share decreased by 26.7% to 2.47p (HY24: 3.37p).
The table below (Adjusted Performance Measures) provides a clear
reconciliation of the adjusted performance to the reported numbers.
Adjusted performance measures:
Half year ended Half year ended Change Year ended
30 June 30 June 2024 31 December 2024
2025
£000 £000 £000
Operating profit 3,044 4,145 (26.8%) 8,171
Adjustments:
Exceptional items 293 - -
Aborted corporate transaction costs and exceptional items - 444 543
Amortisation of acquired intangibles 687 684 1,372
Adjusted operating profit 4,024 5,273 (24.5%) 10,087
Depreciation 1,859 1,917 3,924
Adjusted EBITDA 5,883 7,190 (18.1%) 14,011
Finance income/(expense) (102) (16) (211)
Depreciation (1,859) (1,917) (3,924)
Adjusted profit before taxation 3,922 5,257 (26.4%) 9,876
Basic earnings per share 2.47p 3.37p (26.7%) 6.59p
Adjusted basic earnings per share (a) 3.30p 4.28p (22.9%) 8.18p
(a) The calculation of adjusted basic earnings per share is based on the
adjusted profit before tax of £3,922,000, which excludes amortisation of
acquired intangibles and exceptional items, then deducting taxation at the
effective group rate of 22.3%, and the weighted average number of ordinary
shares in issue, below in note 3.
Group Cash and Working Capital
Cash generated from operations for the six months ended 30 June 2025 was £3.2
million, compared to £0.9 million for the same period in 2024. Operating cash
conversion from adjusted EBITDA was 54.2%, ahead of our like for like
comparison in 2024 of 12.5% but remaining below our typical first half rhythm
of +80%. This was largely the result of the timing of collections for our
receivables balances given our quieter Q1 and then a stronger profile of
despatches in Q2 across the Group. The timing of our investment of property,
plant and equipment has also been very front loaded with the majority of
projects completed in the first half. We will run ahead of our normalised run
rate for capital expenditure for the full year given the scale of works we
have undertaken over the last 12 months particularly and expect the investment
profile to normalise in FY26.
Aside from these specific timing differences we remain very confident in the
underlying fundamental cash-generating ability of the business and we expect
operating cash conversion to return to more historic levels in the second half
to continue to underpin the approach to our capital allocation priorities for
the Group.
Half year to Half year to
30 June 2025 30 June 2024
Net cash generated from operations £3.2m £0.9m
Tax paid (£0.9m) (£1.6m)
Purchase of property, plant and equipment (£3.8m) (£2.5m)
Aborted corporate transaction costs - (£1.0m)
Exceptional payments (£0.3m) -
Own shares acquired (£0.3m) -
Shareplan purchase (£0.2m) -
Settlement for exercised share options - (£1.0m)
Lease payments (£0.5m) (£0.4m)
Interest paid (£0.1m) -
Dividend paid (£1.5m) (£1.4m)
Other (£0.1m) £0.1m
Net (decrease)/increase in cash and cash equivalents (£4.5m) (£6.9m)
Net cash £1.5m £4.1m
At the half year the Group had net cash of £1.5 million (HY24: £4.1
million).
Our operating cash generation, net cash position and new £20 million Sterling
and Euro denominated bank facility provides the Group with considerable
financial resilience and flexibility to pursue our capital allocation policy.
We were very pleased to agree the new bank facility in August which is
committed until August 2028 with a further two 1-year extension options.
Property, plant and equipment
Our capital expenditure in the first half of the current financial year
highlights our continued focus on proactively maintaining well invested and
efficient manufacturing facilities. The principal expenditure over the first
half was focused on Carlton, Floren and Michelmersh with the ongoing works
carried over from 2024 continuing as the three facilities were closed from the
start of this financial period. Taking each site in turn, Carlton was offline
for all of January facilitating the completion of works started in November
2024. The works took two weeks longer than we originally planned given the
unfortunate delay on the manufacture of a key element of tooling. Michelmersh
was closed for all of January and February as we undertook and completed major
kiln refurbishment works and key equipment upgrades. Floren remained closed to
the end of February as we concluded the major upgrades to improve the
environmental efficiency of our manufacturing processes through the
installation of a new exhaust scrubber system. As we discussed in our 2024
final results, the changes to the Floren exhaust system also facilitated
changes in our input materials mix to importantly extend the life of our
mineral reserves significantly which we successfully trialled in March with
very satisfactory results.
As we highlighted last year, we focused on working with our customers and
directing our inventory build leading up to these scheduled gaps in production
as we targeted continuing to supply all our customers' product requirements.
We were largely successful at Floren and Michelmersh with despatch volumes in
line with our expectations but the longer period of closure at Carlton did
unfortunately impact our manufacturing and despatch volumes.
We also took the decision to accelerate our planned integration of our
FabSpeed brand where we completed the installation of a new facility at our
Michelmersh site as well as expanding the scale of our operations at Charnwood
which allowed us to relocate our existing Watlington operations. With the
relocation expected to complete in September we will now exit this previously
leased site by the end of this financial year.
Purchase of own shares and share option cancellation
In April 2025 we announced the renewal of our share buyback programme which we
first launched in November 2022 to reduce the share capital of the Group and
to return value to shareholders. The scheme continues to run with a maximum
aggregated consideration of £2.0 million up to the end of December 2025 of
which £0.3 million had been spent up to the end of the period purchasing an
additional 337,500 shares, taking the total shares purchased to date to
2,562,500. The shares continue to be held as treasury shares.
Sustainability
Sustainability is one of the four core pillars of our business, guiding
investment and operational improvements across the Group. In the first half,
we have continued to reduce our environmental footprint, expanded social value
initiatives, and strengthened governance frameworks for ESG reporting. We
continue to track progress against 17 non-financial KPI disclosures in line
with our net zero 2050 goals, whilst making significant progress in planning
strategies for substantial reductions in carbon and energy intensity for the
Group.
We have accelerated our energy and carbon strategy, working with independent
consultants to define a clear pipeline of major decarbonisation projects for
implementation over the next decade. The initial focus is on data,
optimisation, and efficiencies to fast-track delivery, supported by the
expansion of our on-site renewable power generation projects, reducing
reliance on external energy and reinforcing our commitment to a low-carbon
future.
Board changes
Peter Sharp steps down from the Board today as he retires from his role as
Chief Executive Officer but we are delighted that Peter is staying with the
business in his new role as industry adviser to the Board. Peter has been on
the Board since 2016 and during that period the Company has enjoyed
significant growth and success with the Group's annual brick output increasing
from 70 million to over 120 million. The portfolio has also broadened to
include brick fabricated products and the Company also entered the European
market with Floren in 2019. Peter has worked within the Clay industry for over
40 years so his extensive experience will be of great use to the Board and
myself in his new position. Peter has been a highly valued colleague and
member of the Board and from a personal perspective I have been very grateful
for his support and advice over the last 4 years since I joined the Company.
I am also delighted to announce that Rachel Warren has joined the Board today
as our new Chief Financial Officer following a thorough recruitment
process. Rachel joins us from Wincanton, the former FTSE listed group who
supply business critical services including storage, handling and
distribution, where she has been Group Finance Director since January 2022.
Prior to that, she spent the majority of her career within the IAG Group of
companies, including her role as Director of Business Control for Aer Lingus
and a suite of Financial Controller roles within British Airways. Rachel is
both a qualified accountant and a fellow of the Association of Chartered and
Certified Accountants.
With these changes, we believe that the Board is building a strong balance of
skills and experience to support the Group as we continue to deliver against
our strategic objectives.
Dividend
The Board recommended a final dividend in respect of 2024 of 3.00 pence per
ordinary share to shareholders. The dividend was approved by shareholders at
the AGM on 15 May 2025 and as a result the liability for the dividend payment
was accrued in the 30 June 2025 interim accounts with the £2.8 million
payment made after the half year end on 9 July 2025.
Reflecting our recognition of the importance of our dividend policy to
shareholders, the Board has declared an interim dividend of 1.60 pence per
ordinary share ("pps") (30 June 2024: 1.60pps). The dividend will be paid on 8
January 2026 to members on the register on 1 December 2025 and is not accrued
in the 30 June 2025 interim accounts. The ex-dividend date will be 28 November
2025. With this interim dividend declaration, the Board is maintaining its
policy of one third of the total annual dividend being paid at the interim
stage and two thirds of the expected total annual dividend being paid at the
full year.
Outlook
The resilience of our business model continues to be significantly tested by
the fluctuating nature of the construction sector and UK brick despatches
still 25% below the demand levels experienced from 2022 and through to H1
2023. Despite this long two-year trough, we have focused on our strategic core
principles of well-maintained and efficient operations that manufacture the
highest quality premium brick products for our customers. We believe in the
fundamentals of our business which is underpinned by the quality of our
product portfolio and the strength of our customer and distributor
relationships. Following the robust first half, maintaining a well-balanced
forward order book through appropriate pricing that covers the broadest range
of end markets and customers is essential as we look to deliver a stronger
second half.
In the UK, current order intake is running ahead of our manufacturing capacity
which is contributing to a resilient order book and deliberately targeted at
looking to cover the delays in despatches we experienced in the first half due
to customer progress delays. In Belgium the market continues to deteriorate
with activity levels measured by housing planning approvals now 40% below
historic norms. Consequently, Floren begins the second half with a temporary
pause on production. However, we have focused on supporting our people
alongside ensuring we have strong inventory coverage available and onsite to
minimise any potential impact on our customers ahead of our current planned
restart in Q4. The significant strength of our balance sheet continues to
underpin our ability to flex our production planning whilst we continue to
navigate the difficult current market conditions. Our commercial teams are
focused on continuing to diversify across RMI, housing, commercial, social and
specification projects and this whole market strategy continues to underpin
our resilient outlook.
Despite the lower consumer demand in our sector, we remain well placed at the
premium end of the brick market in the UK and Benelux markets. The UK
Government has continued to emphasise its focus on improving the overall
planning process to deliver its 300,000 new home target over the next four
years. These elements indicate that the long-term fundamentals of our markets
are positive, with brick continuing to be the façade material of choice due
to its longevity, sustainability and energy efficient qualities in use, low
cost and broad aesthetic appeal. We believe we are well-positioned
operationally to benefit from an improvement in wider market conditions,
including a more favourable interest rate environment and reducing mortgage
rates.
The active risk management of our cost base has supported our ability to focus
on competitive pricing for our customers and we will focus on our partnerships
and collaboration with our customers as we move into the second half and
prioritise forward demand.
Our continued sustainable operational cash generation underpins our liquidity
position at the half year. Combining this with our new £20 million borrowing
facility provides the Group with both considerable financial resilience and
flexibility to pursue our capital allocation policy as we focus on
delivering further value for our shareholders.
The Group continues to operate on the basis of maintaining a well-balanced
forward order book, deep and loyal customer and distributor relationships
supported by a robust demand from the specification, housing, RMI and
commercial sectors. The medium term fundamental market drivers for our
business are encouraging and we are very well positioned but given the ongoing
challenges in our sector and the delays in the planning process combining with
the interest rate environment remaining unpredictable the Board expect our
second half performance to improve on H1 and deliver full year performance
broadly in line with FY24. We believe our broad brick and brick-fabrication
portfolio supports our ability to address the full breadth of our end markets
and it is these quality fundamentals in our business that provide resilience
and underpin our positive strategic outlook.
Ryan Mahoney
Chief Executive Officer
Consolidated Income Statement
6 months 6 months 12 months
ended 30 ended 30 ended 31
June June December
2025 2024 2024
£'000 £'000 £'000
Unaudited Unaudited Audited
Revenue 35,769 35,390 70,107
Cost of sales (23,752) (22,567) (44,981)
Gross profit 12,017 12,823 25,126
Administration expenses (8,362) (8,015) (15,618)
Amortisation of acquired intangibles (687) (687) (1,372)
(9,049) (8,702) (16,990)
Other income 76 24 35
Operating profit 3,044 4,145 8,171
Finance income/(expense) (102) (16) (211)
Profit before taxation 2,942 4,129 7,960
Taxation (656) (1,012) (1,856)
Profit for the period 2,286 3,117 6,104
Basic earnings per share attributable to the equity holders of the 2.47p 3.37p 6.59p
company
Diluted earnings per share attributable to the equity holders of the 2.41p 3.25p 6.46p
company
.
Consolidated Statement of Comprehensive Income
6 months 6 months 12 months
ended ended ended
30 June 30 June 31 December
2025 2024 2024
£'000 £'000 £'000
Unaudited Unaudited Audited
Profit for the financial period 2,286 3,117 6,104
Other comprehensive income/(expense)
Items which may subsequently be reclassified to profit or loss
Currency movements 133 96 (65)
Items which will not subsequently be reclassified to profit or loss
Revaluation deficit of property, plant and equipment - - (2,325)
Revaluation surplus of property, plant & equipment - - 5,187
Deferred tax on revaluation movement - - (969)
133 96 1,828
Total comprehensive income for the financial period 2,419 3,213 7,932
Consolidated Balance Sheet
As at As at As at
30 June 2025 30 June 2024 31 December 2024
£'000 £'000 £'000
Unaudited Unaudited Audited
Assets
Non-current assets
Intangible assets 21,905 23,266 22,587
Property, plant and equipment 72,565 64,756 69,387
94,470 88,022 91,974
Current assets
Inventories 18,921 19,537 19,212
Trade and other receivables 14,889 13,152 9,772
Cash and cash equivalents 1,514 4,086 6,004
Total current assets 35,324 36,775 34,988
Total assets 129,794 124,797 126,962
Current liabilities
Trade and other payables 16,325 15,686 11,437
Lease liabilities 799 620 689
Corporation tax payable 821 963 1,061
Total current liabilities 17,945 17,269 13,187
5,420 5,420
Non-current liabilities
Lease liabilities 1,891 1,246 1,575
Deferred tax liabilities 16,269 15,357 16,269
18,160 16,603 17,844
Total liabilities 36,105 33,872 31,031
Net assets 93,689 90,925 95,931
Equity attributable to equity holders
Share capital 19,181 19,181 19,181
Share premium account 16,724 16,724 16,724
Other reserves 22,858 20,745 22,764
Retained earnings 34,926 34,275 37,262
Total equity 93,689 90,925 95,931
Consolidated Statement of Changes in Equity
Share Share Other Retained Total
Capital Premium Reserves Earnings Equity
£'000 £'000 £'000 £'000 £'000
As at 1 January 2024 19,181 16,724 21,615 35,324 92,844
Profit for the period - - - 3,117 3,117
Currency difference - - 96 - 96
Total comprehensive income - - 96 3,117 3,213
Total comprehensive income
Share based payment - - 29 - 29
Released on settlement of options - - (995) - (995)
Dividends paid - - - (1,388) (1,388)
Dividends payable - - - (2,778) (2,778)
As at 30 June 2024 19,181 16,724 20,745 34,275 90,925
Profit for the period - - - 2,987 2,987
Currency difference - - (161) - (161)
Revaluation deficit - - (2,325) - (2,325)
Revaluation surplus - - 5,187 - 5,187
Deferred tax on revaluation - - (969) - (969)
Total comprehensive income - - 1,732 2,987 4,719
-
Share based payment - - 397 - 397
Released on settlement of options - - 35 - 35
Shareplan purchase - - (41) - (41)
Deferred tax on share options - - (104) - (104)
Dividend payable - - - 2,778 2,778
Dividend paid - - - (2,778) (2,778)
As at 31 December 2024 19,181 16,724 22,764 37,262 95,931
2,212
Profit for the period - - - 2,286 2,286
Currency difference - - 133 - 133
Total comprehensive income - - 133 2,286 2,419
-
Share based payment - - 114 - 114
Released on exercise of options - - (151) - (151)
Purchase of own shares - - - (347) (347)
Dividends paid - - - (1,502) (1,502)
Dividends payable - - - (2,773) (2,773)
As at 30 June 2025 19,181 16,724 22,858 34,926 93,689
Other reserves consists of merger reserve, FX reserve, revaluation reserve and
share based payment reserve.
Consolidated Statement of Cash Flows
6 months 6 months 12 months
ended ended ended
30 June 30 June 31 December
2025 2024 2024
£’000 £’000 £’000
Unaudited Unaudited Audited
Net cash generated by operations 3,175 896 10,185
Exceptional payments (293) - -
Aborted corporate transaction cost * - (958) (958)
Taxation paid (896) (1,581) (2,323)
Net cash (used in)/generated by operating activities 1,986 (1,643) 5,539
Cash flows from investing activities
Purchase of property, plant and equipment (3,787) (2,544) (5,600)
Proceeds from sale of fixed assets 33 - 6
Investment in intangible assets (4) - (8)
Net cash used in investing activities (3,758) (2,544) (5,602)
Net cash used in investing activities (1,004) (1,004) (227)
Cash flows from financing activities
Interest received/(paid) (102) (16) (211)
Lease payments (483) (409) (821)
Settlement for exercised share options - (995) (960)
Shareplan purchase (152) - -
Purchase of own shares (347) - (41)
Proceeds from share schemes - 29 -
Dividends paid (1,502) (1,388) (4,166)
Net cash used in financing activities (2,586) (2,779) (6,199)
Net (decrease)/increase in cash and cash equivalents (4,358) (6,968) (4,896)
Cash and cash equivalents at beginning of period 6,004 10,958 10,958
Foreign exchange differences (132) 96 (58)
Cash and cash equivalents at end of period 1,514 4,086 6,004
Cash and cash equivalents comprise:
Cash at bank and in hand 1,514 4,086 6,004
*The aborted transaction costs for June 2024 and December 2024 have been
reclassified from financing activities to operating activities on the basis of
where they were classified in the income statement. This has resulted in the
net cash used in financing activities and the net cash (used in)/generated by
operating activities changing.
NOTES TO THE GROUP INTERIM REPORT
1. GENERAL INFORMATION
Michelmersh Brick Holdings PLC ("the Company") is a public limited company
incorporated in the United Kingdom under the Companies Act 2006 (registration
number 3462378). The Company is domiciled in the United Kingdom and its
registered address is Freshfield Lane, Danehill, Haywards Heath, West Sussex,
RH17 7HH. The Company's Ordinary Shares are traded on AIM, part of the
London Stock Exchange plc. Copies of the Interim Report and Annual Report and
Accounts may be obtained from the address above, or at www.mbhplc.co.uk
(http://www.mbhplc.co.uk) .
2. ACCOUNTING POLICIES
Basis of preparation
The interim financial information in this report has been prepared using
accounting policies consistent with IFRS as adopted by the United Kingdom.
IFRS is subject to amendment and interpretation by the International
Accounting Standards Board (IASB) and the IFRS Interpretations Committee and
there is an ongoing process of review and endorsement by the United Kingdom.
The financial information has been prepared on the basis of IFRS that the
Directors expect to be adopted by the United Kingdom and applicable as at 31
December 2025. The group has chosen not to adopt IAS 34 "Interim Financial
Statements" in preparing the interim financial information.
Statutory accounts
Financial information contained in this document does not constitute statutory
accounts within the meaning of section 434 of the Companies Act 2006 ("the
Act"). The statutory accounts for the year ended 31 December 2024 have been
filed with the Registrar of Companies. The report of the auditors on those
statutory accounts was unqualified and did not contain a statement under
section 498(2) or (3) of the Act.
The financial information for the six months ended 30 June 2025 and 30 June
2024 is unaudited.
3. EARNINGS PER SHARE
The calculation of earnings per share is based on a profit of £2,286,000 (six
months ended 30 June 2024 -£3,117,000; 12 months ended 31 December
2024-£6,104,000) and 92,448,069 (at 30 June 2024 92,592,874 and 31 December
2024, 92,601,027) being the weighted average number of ordinary shares in
issue, excluding those held in the employee benefit trust.
Diluted
At 30 June 2025 there were 2,288,179 (June 2024: 3,419,294, and at 31 December
2024: 1,976,771) dilutive shares under option leading to 94,736,248 shares (30
June 2024: 96,012,168, and at 31 December 2023: 94,577,798) being the weighted
average number of ordinary shares for the purposes of diluted earnings per
share. A calculation is performed to determine the number of share options
that are potentially dilutive based on the number of shares that could have
been acquired at fair value, considering the monetary value of the
subscription rights attached to outstanding share options.
Own shares held
At 30 June 2025 893,010 (30 June 2024 - 1,085,705; 31 December 2024 -
1,077,552) ordinary shares were held by Michelmersh Brick Holdings
PLC Employee Benefit Trust (the "EBT") and are intended to be used to satisfy
the exercise of share options by employees. The EBT is a discretionary trust
for the benefit of the Company's employees, including the Directors of the
Company. Dividends on these shares have been waived.
The market value of the shares held in the trust at 30 June 2025 was £1.0m
(30 June 2024 and 31 December 2024: £1.0m). All 893,010 shares held by the
EBT were acquired by the trust prior to the period and 184,542 shares were
used in the period to satisfy awards following the vesting of shares relating
to Company share incentive schemes.
As a result of the share buyback programme, 2,562,500 shares had been bought
up to the 30 June 2025 (30 June 2024 and 31 December 2024 - 2,225,000) and are
held in treasury and excluded from the weighted average share calculations and
the dividends on these shares have been waived.
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