 Ibstock PLC on Thursday said it has made a good start to 2023, despite a "subdued demand environment" in residential new-build home and repair, maintenance & improvement markets.
The Leicestershire, England-based maker of clay and concrete building products said earnings before interest, tax, depreciation and amortisation were ahead slightly ahead of expectations in the first quarter. Ibstock said this was due to disciplined capacity and cost management, as well as "good commercial execution".
The firm noted that cost inflation has slowed in comparison with 2022 levels, adding that it has hedge 95% of energy requirements for the first half of the year, and about 75% for the whole of 2023.
Ibstock said its Atlas, Aldridge and Nostell growth investment projects are making progress, while Ibstock Futures grew in line with expectations in the first quarter.
Chief Executive Officer Joe Hudson said: "We've made a good start to 2023, with Ebitda marginally ahead of our expectations, underpinned by strong operational discipline and good commercial execution. Market conditions were subdued through the early months of 2023, although we expect this to improve as the year progresses.
"Our major organic growth investments remain on track, with our pathfinder factory at Atlas expected to deliver the UK's first carbon-neutral verified bricks by the end of the year, and Ibstock Futures continuing to build capability and scale."
Looking forward, Ibstock said it is confident in meeting market expectations for 2023.
Ibstock shares were down 0.2% to 166.60 pence each in London on Wednesday morning.
By Harvey Dorset, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2023 Alliance News Ltd. All Rights Reserved. |
Cheers edmund. As suspected it was me being thick. |
I think Forterra is comparatively Undervalued by c.10% compared to Ibstock, irrespective of the general undervaluation of UK listed brickmakers. |
edmund
Its probably me being thick but
'I prefer FORT by 10% but if they went up by 10% I would like IBST as much' ?? |
I own both, but at current prices I prefer Forterra by 10% or so (i.e. if FORT went up 10% or so I would like he both as much). So I currently hold more FORT. But I like both. |
Appreciated. |
Essential
I noticed you were a regular on the Fort board and was actually on the verge of asking the same question of you. I notice that FORT has quite a bit better yield and both have new production facilities and appear to be in rude health financially. My humble opinion is that they both seem to have fairly bright prospects. They have stood up fairly well considering the economic state of the country and the recent turmoil in the markets. The gross shortage of housing has to be addressed at some point and it has a bit of a tradition at leading us out of recession. Trouble is with this govt it cant seem to sort out a planning policy and seems more interested in punishing landlords and the rental industry than it does addressing the housing shortage. before Covid a friend of mine whose business is supplying construction companies with bricks mainly was always bemoaning the shortage of bricks and the fact that they had to import more expensive ones. I cant see that much has really changed and once construction starts to pick up it will hopefully be a bit of a boom. I appreciate that doesnt answer your question but as I said - I was hoping you would :-) |
IBST v FORT, any views on which the better value atm?. |
5.5p and going ex-dividend next Thursday. |
Has the dividend been set yet for payment on 12 May? |
As both a Bellway and Ibstock holder interested to read this in today's interims from Bellwsy
Quote
While material availability issues continue to be well-managed by our experienced procurement teams, product shortages have led to some instances of construction delays. Since the start of the new calendar year, lower demand for construction materials is helping to alleviate some of these pressures. For bricks and blocks, availability should begin to improve following the recent increase in UK manufacturing capacity, while also reducing the requirement for more expensive imports.
Unquote |
have to say IBST stood up fairly well in the weeks market carnage |
Market turmoil could provide a good opportunity here.
Back to recent year lows? |
This is from the Prelims of Forterra which came out a day after IBST.
I thought a good macro overview.
Quote
Despite current and announced capacity investments, the UK brick industry still lacks the capacity required to meet demand. Current domestic production capacity of c2.1bn clay bricks per annum, remains lower than the pre-financial crisis figure of 2.6bn, supporting the increase in brick imports seen in the year with the number of imported bricks increasing by 35% relative to 2021.
We know that our customers would rather buy British wherever possible because we can ensure provenance and quality supplied directly from stock, for prompt delivery with lower transportation costs. These market dynamics leave us ideally placed to substitute imports with production from our new brick factory at Desford. Whilst it is likely that deteriorating economic conditions will reduce demand for our products in the near term, the ability to displace imported bricks will insulate ourselves and other UK brick manufacturers from some of the fall in demand as our customers switch from imports to domestically manufactured products which are expected to become more freely available. |
Good to have a 5.2pc yield and statutory pe of 8x |
I need to listen to the webcast and I hope they were asked what will be the impact of the sizeable declines in housebuilding we have seen forecast by the big housebuilders in recent weeks.
I note they say that 2023 full year expectations have not changed but not told when these expectations were formulated.
Very impressive ROCE figures.
I currently plan to stay with what I have. |
gsw
Conditions to remain subdued. Its a surprise if that's a surprise. Though the markets will no doubt be happy to be unhappy !! |
'Conditions to remain subdued' in the early part of 2023 is a bit worrying.Good to see an increase in dividend which gives some confidence going forward.
Let's see how the market takes it. |
Even good results seem to be greeted with a drop this year. Not holding my breath. |
Economy as a whole is going through a soft patch; let's hope Rishi's corporation tax bomb will not extend that to a long drawn-out underperformance of the UK. Still, houses are needed, this is not going to be the worst affected sector. |
Would imagine that share price reacts to predictions for expected performance for year ahead rather than last year reported. At the mo difficult to see a lot of excitement generated |
All shares to do with building tend to fall on day of results atm
Return to 150? |
Neither am I. Doesnt it all depend on when you compare it to? We have had higher highs and higher lows. |
Lower highs and lower lows - Not a chartist but looks as though a red flag.
kalai1 - Agreed. |
Finals Wed. |
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