A slowdown in the new homes market has contributed to a big drop in profits at the 海角视频鈥檚 biggest brick maker. Ibstock, which is headquartered in north west Leicestershire, said pre-tax profits for the first six months of the year dropped 拢21 million to 拢30 million compared to the same time last year.
Revenues were down 14 per cent at 拢223 million while net debt rose from 拢36 million to 拢89 million.
The business announced today that it is in talks to close its 鈥渉igher-cost鈥 Ravenhead factory in Lancashire, which makes 40 million bricks a year.
In interim results for the six months chief executive Joe Hudson said: 鈥淎s we have done previously during periods of challenging trading, we have taken decisive action to reduce costs across the business; this includes the difficult decision to propose the closure of our Ravenhead brick factory.
鈥淲e remain vigilant on costs and, as we have demonstrated in the recent past, will continue to take any further action necessary to ensure capacity is aligned with market demand, to protect the performance of the business.鈥
He added: 鈥淥ur first half performance demonstrates our resilience in a subdued market environment, with lower customer demand across both new build and RMI [repair, maintenance, and improvement] segments.
鈥淥ur focus on customer service and commercial execution, coupled with disciplined management of capacity and costs, has enabled us to deliver a result marginally ahead of our expectations, despite more challenging trading conditions.
鈥淲e have continued to make strong progress with our strategic investment plans that will underpin Ibstock鈥檚 future growth and enhance our industry leadership position.
鈥淏y focusing on expansion, diversification and innovation we are building new capabilities in faster and sustainability-led growth segments of the 海角视频 construction market.
鈥淎lthough overall sales volumes were down significantly in the first half, demand showed improvement across the period.
鈥淲hilst recent macroeconomic developments have created increased uncertainty in the outlook, having performed marginally ahead of our expectations during the first half we remain confident in our ability to respond to market conditions in the balance of the year and the board鈥檚 expectations for the full year are unchanged.鈥
Only last year the company said revenues were up 25 per cent at 拢510 million, but business has been hit by reduced residential demand. Despite the subdued trading conditions, the business said its selling prices remained firm.
Ibstock said in the past few months it had opened a new innovation hub in the West Midlands, which gave it a scalable platform for growth, while its Atlas plant in the West Midlands was on track to produce the 海角视频鈥檚 first externally verified carbon neutral brick 鈥 something management hope will be scaled across the group on its journey to net zero.
