6th Sep 2022 14:30
(Alliance News) - Two UK brick companies on Tuesday confirmed their full-year financial outlooks, saying housebuilding remains active despite general worries about recession, inflation and energy supplies.
The comments by Brickability Group PLC and Michelmersh Brick Holdings PLC reinforced similar remarks on Tuesday by Berkeley Group Holdings PLC. The FTSE 100 housebuilder said its trading in the first four months of its new financial year has been ahead of a year before, as high demand is keeping pricing ahead of rising costs.
Brickability told its annual general meeting, held in Bracknell, Berkshire on Tuesday, that business remained strong through the summer months.
Having previously said trading in the first quarter of its financial year was slightly ahead of market expectations, Brickability on Tuesday said it now is in line to meet updated market expectations for the year, which ends March 31, 2023.
"Whilst the macro-economic conditions in the UK and Europe of high energy prices and inflation have been well publicised, the UK housebuilding market continues to be in structural deficit and housebuilding activity continues to be resilient," said Chair John Richards.
Brickability is a construction materials distributor, supplying more than 550 million bricks each year.
Meanwhile, Michelmersh Brick reported half-year results on Tuesday. Pretax profit rose by 12% to GBP5.6 million in the six months that ended June 30 from GBP5.0 million a year before, on a 14% increase in revenue to GBP34.0 million from GBP29.9 million.
The Haywards Heath, West Sussex-based brick maker hiked its interim dividend by 13% to 1.30 pence per share from 1.15p.
Gross margin narrowed to 37.7% from 40.1%, but Michelmersh said it expects the profit margin to improve in the second half, allowing the company to meet full-year expectations. It said it has a strong and "well-balanced" forward order book for the second half.
"Whilst demand for bricks remains high, the group is closely monitoring the impact of elevated inflation and the volatile utility markets so it can react immediately to mitigate these headwinds," Chair Martin Warner said.
Michelmersh makes more than 125 million bricks and pavers per year.
Brickability shares were down 1.1% to 83.10p in London on Tuesday afternoon. Michelmersh shares were up 3.4% at 92.04p.
By Tom Waite; [email protected]
Copyright 2022 Alliance News Limited. All Rights Reserved.
Related Shares:
Michelmersh Brick HoldingsBrickability Group