Ibstock plc Interim Results Statement – period 6 months to 30th June 2018

Positive market backdrop and strong cashflow underpin payment of first supplementary dividend

Ibstock Plc (“Ibstock” or the “Group”), a leading manufacturer of clay bricks and concrete products with operations in the United Kingdom and the United States, announces its unaudited results for the six months ended 30 June 2018.

Results for the period:

Half year to 30 June	2018	2017	Change
Revenue	£229.9m	£228.3m	+0.7%
Adjusted EBITDA¹	£58.4m	£59.7m	(2.2%)
Profit before tax	£50.9m	£38.9m	+30.8%
Statutory basic EPS	10.3 pence	7.6 pence	+35.5%
Adjusted basic EPS¹	9.6 pence	9.5 pence	+1.1%
Interim dividend	3.0 pence	2.6 pence	+15.4%
Supplementary dividend	6.5 pence	-	n/a

Financial Highlights

Adjusted EBITDA in the first half reflects previously announced weather impacted start to the year and increased energy input costs
Successful surplus major asset disposal in 1H 2018 resulted in c.£6 million exceptional profit
Net debt¹to adjusted EBITDA at 1.1x, after £16 million of capex in 1H 2018
Continued strong underlying cash conversion¹
Interim dividend of 3.0 pence per share (2017: 2.6 pence per share) reflecting the Board’s policy of paying one-third of the prior year’s full-year dividend
Supplementary dividend of 6.5 pence per share declared in line with the Group’s policy announced in March 2018

Operational Highlights

UK Clay benefitting from good activity levels within the UK, particularly from the new build housing sector
Commissioning of the Group’s investment in a 100m per annum capacity brick plant in Leicestershire running to plan
Review of UK brick manufacturing assets identified requirement for increased maintenance and refurbishment activity over 2H 2018 and 1H 2019 to sustain manufacturing capability, as announced on 30 July 2018
UK concrete revenues flat year on year, reflecting the weather impacted start to the year and lower activity levels in the Repair, Maintenance and Improvement (“RMI”) market
US performance down marginally year-on-year on a constant currency basis against a strong comparative but with improved momentum going into 2H 2018

Full year expectations

As announced on 30 July 2018, management expects adjusted EBITDA for the year ended 31 December 2018 will be in the range of £121m to £125m with reported EBITDA in the range £130m to £134m

Joe Hudson, Chief Executive Officer, commented: “Demand from the Group’s UK brick customers was strong over the first half, particularly from the new build housing sector, although our performance also reflected some impact from poor weather and increased energy costs. The Group remained strongly cash generative in the period and we are pleased to be declaring both an increased interim dividend and our first supplementary dividend, in line with the policy announced in March.

“Looking ahead, while our decision to increase maintenance spending on our UK brick manufacturing assets will have a short-term impact on our financial performance, this programme will put our UK Clay business in a much stronger position to meet ongoing demand, which continues to be robust, with domestic production remaining below market need. In the US, Glen Gery enters the second half with its order book ahead of the prior year and showing good momentum for the remainder of 2018.

“Overall, market fundamentals remain favourable and Ibstock is well-placed to benefit from this positive backdrop. We are fully focused on delivering our business plan as we trade through the second half.”

Results presentation

Ibstock is holding a presentation to analysts and investors at 09:00 today at the offices of UBS, 5 Broadgate, London, EC2M 2AN. Analysts wishing to attend should contact ibstock@citigatedewerogerson.com to register.

An archived version of today’s webcast analyst presentation is available here.