Brickability Share Discussion Threads

[cwa1] 19/7/2023 16:04

4,000,000 shares went through just after markets closed. That's a solid lump

[essentialinvestor] 18/7/2023 10:53

Do the frequent acquisitions raise the risk profile?, perhaps the market factors that in re the rating.


If you look at FORT and IBST, they both have decades of quarry reserves,
when they say BRCK is on 50% discount to the sector, is that comparing
like with like..

[alter ego] 18/7/2023 07:02

thx for sharing. Useful to know housing is only 50% of their market. That chimes with my view that there's plenty of activity beyond new build housing.

[tole] 18/7/2023 06:34

https://www.investorschronicle.co.uk/news/2023/07/17/brickability-demonstrates-agility/Brickability demonstrates agilityBoard sticks to guidance targets despite market softnessBrickability demonstrates agilityJuly 17, 2023By Michael FahyCompany less reliant on housing, says chairmanShares are valued at a 50 per cent discount to peersWhen compared with peers, Brickability (BRCK) looks like an island of calm in an ocean of tumult.BRCK:LSEBrickability Group PLC1mthToday change2.36% Price (GBP)56.50As peers have warned about weakening earnings given the housing market slowdown, the building products group posted a solid set of results and remained upbeat about its prospects of hitting expectations in its current year, for which house broker Cenkos Securities is forecasting only a slight (1.8 per cent) decline in adjusted pre-tax profit to £39.6mn.In theory, Brickability should have been more vulnerable to a downturn than brickmakers such as Forterra (FORT) and Ibstock (IBST), given that it imports bricks and therefore incurs additional transportation costs. Forterra said last week that while demand for bricks had slumped by around 31 per cent in the first five months of the year, imports had fallen at a faster rate.Yet Brickability chair John Richards argued that brick imports, which made up 20 per cent of the market last year, have some defensive qualities. Most bricks made in UK factories are wire cut but planners in many parts of the south of England insist on the use of bricks moulded from soft mud to blend with the vernacular. These make up around 90 per cent of imports."Unless planners suddenly have a change of heart... that would still give [imports] a good foundation," Richards said.Moreover, despite its name, Brickability has been diversifying via acquisitions since its August 2019 IPO, with the Taylor Maxwell timber and facades business bought two years ago being the biggest. Although it proved to be a slight drag on margins as timber prices fell, these deals have reduced the company's reliance on the housing market. Brickability derived 80 per cent of its revenue from housing at the time of its float, but this has since fallen to 50 per cent, Richards said.Higher mortgage rates have weighed on prices across the sector and Brickability's shares now sit close to a two-year low, some 15 per cent below their listing price. Cenkos argued in a note that they "remain fundamentally undervalued", given a forward price/earnings ratio of 5.5 and an anticipated dividend yield of 6.2 per cent. The shares also trade at a 50 per cent discount to peers, according to FactSet.This looks like great value to those who believe in the long-term prospects of the UK's housing market, but in the short term the risk is demand will remain subdued and earnings potential under pressure. Hold.Last IC View: Hold, 70p, 28 Nov 2022

[km18] 17/7/2023 12:08

Brickability Group plc posted Final Results for FY23 ended 31st March 2023 this morning. Revenue increased by 30.9% to £681.1m, adjusted PBT increased by 28.5% to £44.6m and adjusted EPS increased by 18.6% to 11.93p. Trading in F24 so far has remained in line with expectations, the balance sheet also remains strong with net debt at £8m. Valuation is very attractive with forward PE ratio at 5.3x and dividend yield at 6.7% both comfortably top quartile for the sector. Share price remains in a near 2-year correction and lacks positive momentum, there is no near term rush to buy, particularly with housing directly in the firing line of higher UK interest rates. However, the longer run outlook for the sector and BRCK looks upbeat. This is certainly a stock worth monitoring for the longer run, but it remains in a correction for now...

...from WealthOracle

[scepticalinvestor] 17/7/2023 10:21

I think 20p range is coming...give it timeAimho

[scepticalinvestor] 17/7/2023 10:20

Not good enough. HBs building fewer houses thus fewer bricks needed. Simples...

[gripfit] 17/7/2023 10:08

Good results .. share price not reacting .

[alter ego] 17/7/2023 08:30

thanks for sharing

[davebowler] 17/7/2023 08:13

Cenkos-
Brickability reported FY23 results slightly ahead of recently upgraded forecasts and encouragingly, we are leaving FY24E forecasts largely unchanged. At the headline level, LFL revenue increased by 4% to £681.1m, with EBITDA up 30.4% to £51.5m. Given the market backdrop, this is an impressive result and underlines the benefits of its strategy to diversify its revenues. We believe near-term sentiment will remain a challenge, but the current valuation looks increasingly anomalous. The share price is sitting on a two-year low, 20% below its IPO listing price and now trades on a FY24E PE of just 6x and EV/EBITDA of 4x. This is despite continued delivery/outperformance against expectations. BUY.  Headlines: These are a strong set of results with revenue up 30.9% to £681.1m (inc LFL growth ex timber of 15.4%) and EBITDA up 30.4% to £51.5m (EBITDA margin: 7.6%). Net debt came in at £8.0m, in-line with recently revised expectations and reflecting the step-up in EBITDA, reduced working capital outflow and lower than expected capex. A final dividend proposed of 2.15p, gives a total dividend for the year of 3.16p, an increase of 5.3%. It is also encouraging to note the benefits of recent acquisitions, which have added scale and enhanced its client base.  Forecasts and outlook: We make minor changes to our FY24 estimates, with revenue and EBITDA unchanged. EPS falls back slightly (-3.1%) to 9.9p, reflecting a slightly higher tax charge. We take the opportunity to introduce FY25E forecasts, where we have assumed a nominal improvement in underlying trading. At the headline level, we assume YoY revenue, EBITDA and EPS growth of 3%, 6% and 6% respectively. These forecasts are based on no further deterioration in its core markets and also do not factor in any additional upside from acquisitions. We would note that trading in FY24E remains in-line with the Board’s expectations.  View: In our view, the stock remains fundamentally undervalued. When FY23 EBITDA forecasts were introduced in 2021, we were looking for EBITDA of £22m and EPS of 7p. Today, the group has delivered EBITDA of £51.5m (+134%) and EPS of 11.9p (+70%), the de-rating therefore looks overdone. The long-term fundamentals of the UK housing market look to be well underpinned and the need for Brickability’s service offering remains unchanged. As the market returns to examining underlying valuations, Brickability should firmly be on the radar in terms of a re-rating. BUY.

[alter ego] 17/7/2023 06:45

Final results RNS

John Richards, Chairman of Brickability, said:

"It has been another strong twelve months for the Group. Our continued focus on the strategic expansion and diversification of the business has seen the Group achieve impressive growth in the year. Over the past year, the housebuilding market has been faced with new challenges arising from the macroeconomic and geopolitical environment. Considering the headwinds faced in the wider market environment, the Board is very pleased with the Group's performance.

[scepticalinvestor] 03/7/2023 12:42

Target abt 12p

[death by donut] 26/6/2023 21:33

Well the site work is definitely slowing from what I can tell. We have nearly 40 sites, a crew of 14 and we're going down to 2-3 days a week . Been slowly dropping away since xmas , but has gathered pace recently.I worked through 88-93 , feels like that now tbh.Not deramping , I hold in my sipp and will add if goes lower probably.DbD - from the frontline :-/

[riskonricky] 26/6/2023 17:25

Yep. Probably awaiting full reports. Some might also be wondering if the new CEO might look to push through a pricey acquisition of his old company, MBH, maybe? Current mcap for BRCK abt 3.5x their EBITDA declared for last year - very cheap. MBH looks like abt. 5.4x for comparison. Taylor Maxwell was abt 6x - so they keep getting more and more expensive in a potentially declining market. Let's see

[gamwah] 26/6/2023 11:46

Looking at this one looks cheap?. They put out an ahead of RNS so positive results ahead anything else that's caused the drop back other than just a drift?

[cordwainer] 11/5/2023 16:24

I agree riverman. +4% LFL, or even +15.3% without the impact of timber business.
It's only that the Ibstock commentary is predicting a tough remainder of 2023.
But BRCK has been pro-active over past couple of years particularly with roofing, bespoke bricks and logistics in general. Perhaps we have gained some light-footed advantages there.

[riverman77] 10/5/2023 20:11

Perhaps, but BRCK put out a trading udpate only a couple of weeks ago and confirmed trading was strong. So unless things have suddenly gone downhill in last couple of weeks....

[cordwainer] 10/5/2023 06:17

Take a look at Marshalls and Ibstock commentary .. potential read-across ?

[tole] 28/4/2023 19:02

https://masterinvestor.co.uk/equities/small-cap-catch-up-bank-holiday-deals/Brickability Group (LON:BRCK) – Ready To Edge Higher AgainWednesday's Pre-Close Trading Update from this leading brick factor was really quite positive.The year to end March showed a strong performance in its second half and that was despite the uncertain macroeconomic environment.It guided that the results should show some £681m in revenues, up 30.9% year on year, while its adjusted EBITDA is expected to be not less than £50m, which is ahead of market expectations.Analyst Andrew Gibbs at Cenkos Securities reiterated the group's shares as a Buy, looking for an adjusted pre-tax profit for the last year of some £43.1m (£34.7m), while lifting earnings to 11.6p (10.1p) and easily covering a 3.2p (3.0p) dividend per share.The group, which has a strong acquisition pipeline, is due to declare its finals in July.Ahead of that date I would expect its shares, now 68p, to start to edge higher again, they were up to 93p this time last year.

[mfhmfh] 27/4/2023 10:40

positive guidance from PSN yesterday & TW. today.

IMHO.

[davebowler] 26/4/2023 08:13

Cenkos-Brickability has released a positive pre-close update, confirming FY23E EBITDA will be ahead (c6%) of recently upgraded expectations at c£50m (Cenkos: £47.0m) and this should further reassure as to the resilience of its model. We remain surprised that the share price continues to lag a wider peer group who have experienced a re-rating YTD, despite delivering positive newsflow. In our view, the share price disparity between other related reference points (such as the Housebuilders and Distributors) will have to narrow. On a FY24E EV/EBITDA of 4.6x, this could prove to be a very attractive entry point. The group remains well placed to benefit from long-term structural growth trends, a diverse product mix and the ongoing price inflation in the system. BUY. 

[rimau1] 26/4/2023 07:08

This must be on around 7x earnings now and only the wider macro picture is holding a rerate back? Good to see net debt almost gone and plenty of firepower for earnings enhancing acquisitions. On my watchlist but not a sector in favour for 2023.

[riskonricky] 26/4/2023 06:30

Pre-Close Trading UpdateRevenue GBP 681 millionAdjusted EBITDA GBP 50 million +Net debt GBP 8 millionFull year results for 2022-2023 soon.

[2vdm] 26/4/2023 06:29

Excellent trading update imo. Lets see if it finally affects the sp, although the construction industry is not in favour at the moment.