Firm says restructuring programme will save it 拢20m a year
Falling demand in the new build housing sector has seen brickmaker Ibstock close a second factory in less than six months with the firm saying 2023 revenue will be down by more than one fifth.
The firm said it had closed a factory at South Holmwood in Surrey, following the decision to shut its Ravenhead factory in Lancashire last summer.
It said a restructuring plan would save it 拢20m in annual costs with the initiative also including temporarily reducing capacity as well as rejigging its commercial and innovation arms into one.
In a note, broker Investec said: 鈥淲ith more capacity coming on stream and volume expected to remain subdued in FY24 the review of capacity and cost base all looks sensible and supportive.鈥�
Revenue last year is set to come in at 拢405m, a fall of 21% on 2022鈥檚 number, while it warned that it expected its core construction markets to be subdued this year.
The firm is spending 拢50m on building a new plant in Nostell, West Yorkshire, to create an automated brick slip systems factory capable of producing up to 30 million brick slips a year from the end of this year which it said was 鈥減rogressing to plan鈥�.
Ibstock said at the end of last year, net debt was 拢101m, up from 拢46m at the end of 2022.
Chief executive Joe Hudson said: 鈥淲hile the pace and timing of the recovery remain uncertain, Ibstock is in robust financial health, with the balance sheet strength and financial flexibility to ensure we remain well-positioned for a return to growth over the medium term.鈥�
The firm will release its 2023 results on 6 March.
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