Ibstock’s profit expectations remain unchanged despite falling sales amid weak demand.
In its trading update for the third quarter of the year, the brick maker said sales volumes were lower than in the previous quarter, but margins remained robust thanks to cost cutting and stable prices .
Describing its performance as “resilient” in a “very challenging” market environment, Ibstock said it would continue to ensure capacity is aligned with market demand, while being ready to respond when levels of activity
Ibstock announced in August that it planned to close its factory in Ravenshead, Lancashire, in response to falling demand, a move that would reduce clay brick production capacity by around 40 million bricks.
However, it hopes to bring the UK’s first certified carbon-neutral brick to market next year following major investment at its Atlas factory in Walsall, West Midlands.
Ibstock said the strength of its balance sheet continues to provide resilience in more moderate conditions and strategic optionality for the future, which is reflected in its commitment to growth investment.
While residential construction markets are expected to remain subdued for now, the firm said it will continue to advance strategic initiatives that support medium-term growth.
“The group delivered a resilient performance in the third quarter despite a very challenging market environment,” said chief executive Joe Hudson.
He said he expected a pick-up in market activity as macroeconomic conditions stabilized, reflecting strong underlying demand for new-build homes in the UK.
“While we are taking a cautious view on the pace and timing of this recovery, we remain confident in our ability to continue to respond to market conditions, taking the necessary actions to protect performance, while ensuring that the business remain well positioned for an increase in activity,” he said.
