Shares of British brick making company Ibstock plc (LON: IBST) rallied 10.9% after the company said that its performance during the second half of 2020 was above expectations as market trends improved significantly.
The manufacturer of clay bricks and concrete products recorded full year revenues of £315 million, a 23% decline from 2019 levels, with H2 revenues being down a meagre 10% driven by the cost-cutting measures and improved market conditions.
Ibstock’s cash flow performance for the year was also impressive as it ended the year with £70 million in net debt as compared to the £103 million reported at 30 June 2020; the debt levels were also an improvement on the £85 million recorded in December 2019.
The company also extended its £215 million Revolving Credit Facility by 12 months to March 2023 and settled all outstanding debts with Her Majesty’s Revenue & Customs (HMRC) worth about £7 million.
Ibstock expects its adjusted earnings to be slightly above its prior guidance of £50 million.
Joe Hudson, Ibstock PLC CEO, said:
“I am proud of the way that our people have navigated the challenges of 2020, and I would like to thank them all for their continuing effort and commitment. Our focus remains, above all else, on ensuring the health and safety of colleagues, customers and partners across the supply chain.”
Adding:
“Having taken steps to protect and reshape our business, the Group traded ahead of our expectations in the latter part of the year. While we are mindful of the ongoing uncertainties relating to COVID-19, we are encouraged by the continuing recovery of our markets through the end of 2020 and enter the new year in a strong position to capitalise on the opportunities in front of us.”
Ibstock share price
Ibstock shares rallied 10.87% to trade at 218.2p having risen from Tuesday’s closing price of 196.8p.