Forterra PLC says it anticipates meeting full-year guidance thanks to its ‘discipline’ in 2024.
The Northampton, England-based clay and concrete product manufacturer estimated annual revenue of £345 million, a slight drop from £346.4 million in 2023, but in line with expectations.
Revenue in the second half increased from both the previous year and the first half of 2024, according to Forterra. The company noted a ‘modest’ pickup in fourth-quarter trading, which typically sees a seasonal slowdown, but didn’t provide figures for this.
Adjusted earnings before interest, tax, depreciation and amortisation are expected to be around £50 million in 2024, down from £58.1 million the year prior. This remains in line with guidance, Forterra said.
It also expects to report a boost in full-year cash generation. Adjusted operating cash inflow for 2024 is estimated at £60 million, compared to an outflow of £5.3 million in 2023. Forterra attributed this to a ‘disciplined’ approach to resources and pricing.
Net debt before leases reduced to around £85 million from £93.2 million year-on-year, Forterra said. The company has coverage for 85% of 2025’s energy costs, with ‘good levels of coverage for 2026 and 2027’. Still, Forterra plans to raise its prices in the coming year, after keeping them stable in 2024.
New brick factories are near completion, Forterra said, and are expected to help the firm ‘capitalise on a recovering market’, though ‘the timing and trajectory’ of recovery is uncertain.
Growth in the UK construction sector hit a six-month low in December, according purchasing managers’ index survey results from S&P Global released earlier this month. The construction PMI fell to 53.3 points in December from 55.2 in November.
‘We continue to take encouragement from the government’s ambition to materially increase housebuilding but remain wary of the challenges in delivering this,’ Forterra noted.
Forterra will release its full 2024 results on March 12.
Forterra shares were up 1.3% at 162.00 pence each on Thursday morning in London.
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