22nd May 2018 15:08
LONDON (Alliance News) - Forterra PLC said on Tuesday it recorded a revenue increase in the first quarter and has plans to redevelop its brickmaking facility.
The company also said that its outlook remains unchanged despite severe weather earlier in the year. This is a result of the price increases it has agreed with most of its customers.
Forterra, which supplies building materials, says revenue in the first quarter of 2018 was 12% ahead of a year before. This 12% figure included the benefit of its GBP20 million Bison Precast Concrete acquisition in September last year.
In the four months ending April 30, Forterra said its net debt was GBP72.6 million, up from GBP60.8 million at the start of 2018.
The materials supplier said that the planning application for redeveloping its brickworks in Leicestershire is being finalised. The redevelopment is expected to cost between GBP90 million and GBP95 million between 2019 and 2022. It is expected to be commissioned in "late 2021".
The company has already committed GBP1.5 million in enabling and preparation costs. Brick production will more than double with the new facility producing as many as 180 million bricks per annum compared to the 85 million current yearly production capacity.
The internal rate of return from the expansion is predicted to exceed 15% after tax over 20 years.
The Leicestershire site was chosen because it will allow the company to replace its existing plant in the same location.
"It enables us to replace the existing plant with a larger modern facility, providing both additional capacity and the benefit of a lower production cost. This will give us the flexibility to continue to serve our customers and meet their requirements as the market grows," said Chief Executive Officer Stephen Harrison.
Shares in Forterra were up 0.2% at 332.50 pence each on Tuesday afternoon.
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