Ibstock has warned that its second-half performance will fall materially short of previous expectations after third-quarter brick sales came in 22% below forecast, according to Construction Enquirer.
The UK building products manufacturer is cutting production to limit stock levels and continuing to reduce costs, the publication reported on 2 November.
The sales shortfall is measured against expectations, rather than the same period last year.
Chief executive Joe Hudson was quoted as saying: “Trading conditions deteriorated sharply during the third quarter, with weakness continuing into October.”
Hudson said reducing output would put further pressure on earnings in the near term, but was necessary to bring production into line with demand.
The warning follows a difficult first half. In its interim results published on 5 August, Ibstock reported revenue of £164m, down from £193m a year earlier. Adjusted earnings before interest, tax, depreciation and amortisation fell from £36m to £26m.
At that stage, the company still expected a stronger second half, although full-year earnings were forecast towards the bottom of market expectations.
Ibstock said private housebuilding and repair, maintenance and improvement activity remained subdued. Its brick business was increasingly weighted towards new-build residential demand.
