Ibstock profits fall as it invests in brick production
Clay bricks and concrete products group Ibstock, which has sites in Cannock and Walsall, saw pre-tax profits fall despite rising sales last year.
Ibstock's revenue rose by 3.9 per cent to £451.6 million with the profit figure down 24.7 per cent to £83.4m as it invested in additional UK brick capacity to meet demand.
Ibstock Brick was helped by good activity levels within the UK new build housing sector with brick volumes ahead year-on-year supported by stock reductions.
A new 100m capacity soft mud brick plant in Leicestershire was commissioned in the final three months of 2017 and will expand the group's UK brick capacity by around 13 per cent when in full production next year.
Replacement of the brick kiln at the Lodge Lane blue brick plant in Cannock is on schedule
Wayne Sheppard, chief executive of Ibstock, said: "2017 presented many challenges to the group but we performed strongly during the year, delivering profits and cash generation in line with management's expectations.
"For Ibstock in the UK it was a busy and important period of development - our past decisions to invest in additional brick and roof tile capacity, having recognised the strong fundamentals supporting UK new housing growth, have been well timed as these projects enter production phase. We began 2018 with new capacity in place at a time when it is clearly much needed to support strong market demand."
Mr Sheppard said customer demand in its UK clay and concrete markets remained encouraging.
"While we remain mindful of the uncertainties in the UK economy, we expect another year of progress for the group," he added.
Ibstock Brick currently has 19 manufacturing plants and the largest brick production capacity in the UK. It operates a network of 23 active quarries which are generally located close to its manufacturing plants.