What in isolation looks like a rather generous upward spike on today's chart is merely a recovery from yesterday's dip - bringing it back into line. Closing at 160p?
PS: Found some stats on import/export of bricks. All too confusing to me but doesn't sound like huge amounts. Not sure I trust the figures anyway. |
Thanks for that.
Today's results bad, but perhaps less bad than expected.
Revenue down 10%, profit down 30% and divi down 40%.
But....second half better than first and expectations of improvement throughout this year. |
About 20 years ago I picked up a 40' box from Southampton and took it to a large builders merchant on the West side of Cardiff. I was stunned to see it was full of 26 pallets/tonnes of concrete blocks from Greece. I asked them what they had saved on these 25 tonnes of blocks by importing them? £80 they said! Just £80 on the whole load.
So it seems very small differences in price count for a lot in the eyes of the builders merchants. Given the very high energy prices here IBS have something of a challenge on their hands. Do they have plants where energy and labour is cheap? Transport is cheap and the product doesn't have a 'use-by-date'. |
In the days when I was a buyer in the construction industry, bricks coming in by boat from Holland, Belgium and India were always competitive - even when my own calculations of energy/fuel costs didn't always explain how they did so.
Quite a few of them were re-badged with the names of UK brickmakers. So the presumption that those involved UK kiln costs were wrong. I queried the imprint on some UK-branded bricks I bought at a local merchant this week and they turn out to have come from Turkey. I've not kept pace with recent brick import statistics in the past few years, so I'm not familiar with the current mix of sources. I'm told that some are shipped as convenient ballast for ships carrying higher value lightweight goods - so presumably there is some complex offsetting involved. |
2,500,000 voume. Wow. Hope they have something good to say tomorrow! Recall the offer price on listing here was 190p (stated in the header). Market cap was also higher... this is surely an anomaly in the longer term... |
Finals Wed. |
No expert on brick imports, though the data on hxxps://oec.world/en/profile/bilateral-product/bricks/reporter/gbr is interesting if accurate. Seems terrible ecology to bring in heavy cheap stuff half way round the planet if there is capacity here which obviously depends on demand. Most brick kilns use natural gas and there is little variability in European gas prices according to
however 5x cheaper in Canada and who knows what is being burned outside the EU for brick firing. Suspect many countries happy to burn coal or whatever is cheapest.
Our industrial electicity prices are high compared with Europe but I wonder how much this compares to the total gas bill for bricks? |
wad, do you have a view on the competition posed by brick imports..
Eith sky high energy prices in the UK,
will there be an increasing challenge. |
Re-iteration of the new Gov housebuilding targets by the deputy PM today can't do IBST any harm. Whether they happen is a whole different Q of course.... |
Tipped by RBC with 200p target last week.
hxxps://uk.investing.com/news/analyst-ratings/ibstock-stock-outlook-brightens-as-fy25-volume-inflection-remains-on-track-says-rbc-93CH-3879554 |
Yes, somewhat reassuring. |
Optimistic TU even if it is more about future than current performance, broadly in line. |
What's going on here now? |
Labour want more housing, but they don't want the companies that build it or supply materials to make any money from it. Interesting take on economics from Reeve... |
So much for that little rise, suspect the new Budget charges are going to hit the profitability. |
M&A-driven earnings accretion? What sort of M&A do they envisage I wonder? |
That's a two year high now; keep slapping those bricks down guys! |
 Jefferies raises Ibstock to ’buy’ (hold) - price target 251 (200) pence
Ibstock gained as Jefferies upgraded the shares to ‘buy’ from ‘hold’ "given the current compelling demand-supply dynamic in the UK brick sector". It applied the same upgrade to Forterra.
The bank said it now sees a clear path to return to prior peak EBITDA (i.e. 2022) by 2027, underpinned by a housebuilding-led recovery but also sufficient spare capacity to fully capture this growth.
"This suggests more than 70% upside from 2024 profit levels, offering significantly more upside than at UK building product peers if they too were to return to 2022 levels from 2024 (less than 40%)," it said.
"This uplift is driven by our expectations of a strong demand recovery underpinned by an improving housing market (we forecast UK brick demand to grow circa +35% over 2024-27, after a circa 40% fall over 2022-24).
"However, with domestic capacity utilisation currently at c.60%, we are in a unique position where both main players have the ability to fully capture recovering demand (as opposed to driving higher imports due to capacity constraints as has been the case for much of the past decade)."
Jefferies said that beyond earnings recovery, robust cash generation and deleveraging offer another leg to the investment case, with ample spare cash for M&A and/ or extra returns.
The bank lifted its price target on Ibstock to 251p from 200p and said it was its preferred pick "given its greater liquidity and higher potential for M&A-driven earnings accretion to boost its still nascent Futures division". |
I was suspecting might be more than the "In line" TU, but it seems to be saying that they are well positioned IF demand increases as is expected. I guess this is never going to be a company that suddenly gets a gamechanging new product that is going to double profits overnight. |
Any thoughts re: the trading update? |
* MSLH today |
Thats a suspiciously strong share price rise this week with TU tomorrow, almost as if something has leaked... |
TU Thursday. |
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