>
Brickability shares soar as building materials company raises earnings forecast despite real estate market slowdown
- Birckability expects full year adjusted profit to be at least £47m
- That’s more than current market expectations of £44.7m
Brickability shares rose after the building materials group said its full-year profit would be higher than expected despite a slowdown in the housing market.
The company, which supplies all types of bricks, roofing products and rainscreen cladding, told investors that the strong performance reported in October had continued through the second half across all of its divisions.
It now expects to report an adjusted underlying profit of at least £47m for the financial year ended March 31, above current market expectations of £44.7m.
Brickability, which supplies all kinds of bricks to homebuilders, expects earnings to beat forecasts
The company, which is headquartered in Bridgend, Wales, said it had managed to ‘successfully face’ the challenges and uncertainty afflicting the UK housing market.
Last week, homebuilders Bellway and Redrow signaled continued market challenges, despite a slight uptick in activity in recent weeks.
The groups said higher mortgage payments, rising interest rates and broader inflationary pressures had led buyers to be cautious.
But Brickability remained optimistic, as it told investors in a brief trading update: “While we are aware of the short-term effects on our industries that a challenging macroeconomic environment may bring, the board remains confident that the group is in a is in a good position to continue to achieve its objectives. strategic objectives and the underlying growth of the company.’
AIM Listed Brickability Stocks rose 8.4 percent to 74.50p in morning trading on Monday.
They are up 13 percent since early 2023, but remain about a quarter lower than a year ago.
Andy Murphy, director at Edison Group, said: ‘Brickability is trading at a PER 9x for FY 23 as its share price is down nearly 40 per cent from its 2021 peak, suggesting a lot of bad news has already been priced into the price .’
The company, which has been selling its products in the UK and Europe for over 37 years, says it supplies more than 550 million bricks annually.
It has over 55 stores across the UK and employs around 600 people.
It expects to publish its annual figures at the end of April.