TIDMIBST
RNS Number : 8193I
Ibstock PLC
21 April 2022
21 April 2022
Ibstock plc
AGM Trading Update
Ibstock plc ('Ibstock' or the 'Group'), a leading UK
manufacturer of clay bricks and concrete products, announces a
trading update for the first quarter of FY 2022, ahead of its
Annual General Meeting, which is to be held at 11:00am today.
Highlights
-- Strong start to the year, with Q1 performance ahead of our
expectations driven by stronger clay brick sales volumes
and resilient margin performance
-- Board now expects FY22 performance to be modestly ahead
of its previous expectations
-- Investment-driven growth initiatives progressing well and
GBP30 million Share Buy Back Programme announced today as
part of ongoing value creation strategy
Trading update
The strong start to the year reported at the time of our FY21
results in March has continued, with Q1 performance ahead of our
expectations.
Demand remains firm in all our end markets. Our Clay plant
network is performing well, with production volumes marginally
ahead of our expectations, while our dynamic commercial approach
has enabled a full recovery of input cost inflation. Solid
operational execution in the Concrete division ensured it performed
in line with our expectations, despite some continuing supply chain
challenges.
The operating environment continues to be characterised by
significant levels of input cost inflation, primarily in the
categories of energy, freight, carbon and materials. In relation to
energy, our hedging strategy has positioned us well against a
backdrop of elevated prices. We have now substantially covered
energy requirements for the first half of the year, have purchased
around 75% of requirements for the second half and have over
one-third covered for 2023. The Group remains committed to taking
the actions necessary to protect and maintain margins going
forwards.
The Group is continuing to make good progress with our growth
initiatives: the Atlas, Aldridge and Nostell capital investment
projects are all progressing in line with expectations; and Ibstock
Futures has advanced the integration of the recently acquired glass
reinforced concrete (GRC) assets into its operations.
Having made a strong start to the year, whilst we remain mindful
of broader macroeconomic challenges, the Board now expects full
year 2022 performance to be modestly ahead of its previous
expectations.
Share Repurchase Programme
At the time of our 2021 results announcement in March 2022, the
Group announced a clear path for growth and value creation over the
next five years, based on a combination of investment within its
core business and diversified growth opportunities, supported by a
set of medium-term financial targets.
As part of our disciplined approach to capital allocation, and
with projected Group leverage below our target range, Ibstock is
today announcing its intention to initiate a share buyback
programme of up to GBP30 million.
This return of capital is in addition to our committed growth
investments of over GBP100 million and, after this repurchase
programme, we continue to anticipate significant financial capacity
to support further growth investment and additional shareholder
returns over the medium term.
Joe Hudson, Chief Executive Officer, commented:
"We've made a strong start to 2022, supported by robust demand
in our end markets and a dynamic commercial approach to manage
input price inflation.
Energy prices remain a key focus and our forward buying policy
has ensured that around 75% of H2 2022 requirements are covered,
with more than a third of 2023 requirements also locked in.
Demand in both the new build housing and RMI markets remains
robust and, while we are mindful of the broader macroeconomic
uncertainties, we now expect to deliver performance for the full
year modestly ahead of our previous expectations.
We are also pleased to be announcing a GBP30 million share
buyback programme, demonstrating our ability to deliver enhanced
returns to shareholders whilst continuing to invest in our future
growth."
Ibstock plc 01530 261 999
Joe Hudson, CEO
Chris McLeish, CFO
Citigate Dewe Rogerson 020 7638 9571
Kevin Smith
Holly Gillis
About Ibstock Plc
Ibstock plc is a leading UK manufacturer of clay bricks and a
diversified range of clay and concrete
products. Its principal products are clay bricks, brick
components, concrete roof tiles, concrete alternatives for stone
masonry, concrete fencing and pre -- stressed concrete
products.
The Group's two divisions are:
Ibstock Clay: The leading manufacturer by volume of clay bricks
sold in the United Kingdom. With 16 manufacturing sites Ibstock
Brick has the largest brick production capacity in the United
Kingdom. It operates a network of 18 active quarries located close
to its manufacturing plants. Ibstock Kevington provides masonry and
pre-fabricated component building solutions, operating from 6 sites
across the United Kingdom.
Ibstock Concrete: A leading manufacturer of concrete roofing,
walling, flooring and fencing products, along with lintels and
general concrete building products, with 14 manufacturing plants in
the United Kingdom.
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