Forterra, the manufacturer of clay and concrete building products, has “delivered a strong performance in the first half of 2022 supported by a backdrop of robust market conditions.”
The company noted that brick sales volumes were slightly ahead of the prior year and in line with 2019, limited only by capacity constraints rather than demand, with factories generally operating at capacity and with inventory levels remaining at record low levels.
Results have also benefited from the firm’s ability to pass on cost inflation to customers, with two price increases delivered in the period.
For the six months ended 30 June 2022, Forterra posted total revenue of £222.8m, an increase of £42.5m (23.6%) on the prior year (£180.3m) and an increase of £29.2m (15.1%) on 2019 (£193.6m).
Meanwhile the company reported adjusted profit before tax of £37.3m, compared with a profit of £27.1m in 2021 and £32.7m in 2019, and a statutory profit before tax of £44.2m, compared with a profit of £29.1m in 2021 and £32.7m in 2019.
Full year expectations have now slightly increased.
Stephen Harrison, Chief Executive Officer, said: “Forterra delivered a strong performance in the first half of 2022, against the backdrop of robust market conditions. Sales volumes were slightly ahead, limited by capacity constraints rather than demand, with our factories generally operating at capacity and with inventory levels remaining at record low levels.
“We also benefited from our ability to pass on cost inflation to our customers with two price increases delivered in the period, facilitating an improvement in margins relative to 2021 as a whole.
“We continued to produce strong operating cash flows, enabling us to progress our strategic capital investment and innovation plans. Our strong financial position allows us to increase capacity, to better serve our customers; to focus on efficiency; and to reduce our carbon footprint, thus progressing our sustainability agenda.
“We anticipate current trading conditions will continue in H2, despite growing macro-economic uncertainty. The temporary closure of our Wilnecote brick factory, ongoing capacity constraints and the closure costs and inefficiencies relating to the old Desford brick factory will influence H2 performance. Despite this, the performance to date and our expectations looking forward, lead the Board to anticipate a full year 2022 result slightly ahead of the Board’s previous expectations.”
