GB: Ibstock builds healthy rise in sales and profits

Ibstock PIC Demand for new housing helped the UK's largest and oldest brick manufacturer record a healthy rise in sales in the year it floated on the London Stock Exchange.

County brick maker Ibstock, valued at £770.5 million in its October listing, said group revenue for the 12 months to the end of December rose 10.6 per cent to £412.8 million, up from £373.2 million in 2014.

Adjusted profits for the period, taking acquisitions into account, rose 64.7 per cent from £65 million in 2014 to £107 million last year.

Wayne Sheppard, the chief executive of Ibstock, said: "Our 2015 results are particularly pleasing as they clearly show that despite the CRH disposal and subsequent IPO we maintained our focus and delivered excellent growth in sales, profitability and cash generation for our investors.

"While it is early in the year to have any real visibility, at this point our expectations for the full year remain unchanged despite a slower start for UK brick sales into the RMI [home improvement] market.

"Our major capital investment projects are progressing to plan and we anticipate another year of progress in 2016. The fundamentals supporting our business remain strong."

In December 2014 CRH, the building materials group, sold Ibstock Brick, as it was then known, to private equity giant Bain Capital for £414 million in cash and debt.

US clay business Glen-Gery and UK concrete product makers Forticrete and Supreme Concrete were also part of the sale.

Ibstock, which employs 350 people in Leicestershire, then floated in London raising £100 million.

The company used £80 million of the cash raised to refinance its banking facilities and pay down existing debts. The remaining £20 million funded the cost of the listing.

Mr Sheppard said Ibstock is thriving as a publicly quoted company.

He said: "The UK business, which accounts for about 81 per cent of the group, performed strongly in the year to December 31 2015. The improvement in revenue and profitability reflects a strong pricing environment for clay bricks and good pricing for other products."

As well as making clay bricks, Ibstock also manufactures brick components, concrete roof tiles, concrete substitutes for stone masonry and concrete fencing.

Ibstock has the capacity to make 780 billion bricks a year. This will increase by 100 million in the second half of 2017 – enough to build 15,000 detached homes and garages – when the company's new £50 million factory just outside Ibstock goes into production. The move will create 50 jobs.

Increased capacity could also help Ibstock grow its 40 per cent share of the UK brick making market.

Mr Sheppard said: "If no one else increases capacity [in the UK] then our market share, by implication, will potentially grow organically. We are really aiming the plant at imports as the UK currently imports 300-300 million bricks a year."

In a statement Ibstock said its Glen-Gery US business was also "performing strongly".

Mr Sheppard said this was due to "a combination of rising volumes and higher average prices" reflecting a "more favourable product mix".

Source Leicester Mercury par Lauren Mills