Ibstock plc (LON:IBST), a leading manufacturer of clay bricks and concrete products in the United Kingdom, announced today its results for the year ended 31 December 2019.
Financial Highlights:
- Solid revenue growth of 5%, reflecting growth in both our Clay and Concrete divisions
- Adjusted EBITDA of £122 million, representing growth of 2% excluding a c.£7 million benefit from the adoption of IFRS 16
- Adjusted EPS for 2019 marginally lower year-on-year, reflecting a higher effective tax rate for the year of 18.9% (2018: 17.4%)
- Statutory PBT and EPS for 2019 are lower year-on-year, primarily reflecting exceptional profits on disposal of surplus property in FY18
- Final dividend of 6.5 pence per share (2018: 6.5 pence per share) making the 2019 full year ordinary dividend 9.7 pence per share (2018: 9.5 pence per share), a 2% increase
- Continued strong cash flow generation enabled an additional 5.0 pence per share supplementary dividend paid in September 2019
- Net debt at year end, at £85 million, a net debt/EBITDA ratio of 0.7x (pre-IFRS 16), towards lower end of target range
Operational Highlights:
- Resilient trading performance for the year, against a backdrop of political and economic uncertainty and reduced new build housing activity in the second half of 2019
- Solid progress made with our three strategic priorities – Sustain, Innovate and Grow
- Production volumes have benefited from the new Eclipse brick factory in Leicestershire, and the maintenance programme, which progressed as planned, allowing us to re-build inventory during the year from historic low levels
- Integration of Longley Concrete is progressing well and the business has performed in line with expectations
- Sustainability roadmap published with our progress in this area recognised externally with several awards, including an edie award for energy management for the second year in a row
- Announcing £45 million investment to re-develop and expand existing brick factory; to be commissioned in 2022, delivering a leading production cost and sustainability profile
Joe Hudson, Chief Executive Officer of Ibstock plc, commented:
“2019 was a year of progress for Ibstock, as we delivered a resilient trading performance against a backdrop of political and economic uncertainty. We made good progress against our strategic priorities, including measures to enhance production volumes and quality, the strengthening of our executive team and expanding our Concrete business, through the acquisition of Longley Concrete.
“Our strong cash generation allowed us to invest in the business and to pay a further supplementary dividend to our shareholders while remaining towards the lower end of our debt guidance range. Today we are announcing a further investment in a new state-of-the-art 80 million per annum clay brick factory to re-develop our Atlas site, in the West Midlands.
“Fundamentals in the UK remain robust, with a structural housing deficit, low interest rates, high employment and the benefit of the Government’s Help-to-Buy scheme all underpinning the market. However, the political uncertainty which caused more subdued market conditions in the second half of 2019 has meant a slower start to 2020. We anticipate that activity levels will improve as the year progresses, and as a result, expect to deliver a stable outcome for the year.”
