Ibstock PLC on Wednesday reported a drop in annual profit, as lower capacity and activity hurt revenue, and cost-savings efforts required an exceptional charge.

The Leicester, England-based maker of clay and concrete building products said pretax profit fell 71% to £30.1 million in 2023 from £104.8 million the year before.

This was partly due to lower underlying operating profits and an exceptional charge of £30.8 million, Ibstock explained, which was related to a restructuring plan.

In the final quarter of the year, Ibstock said it conducted a ‘comprehensive’ operational review, to align its cost base and capacity to its expected near-term demand. This resulted in reducing capacity across the business on a temporary basis, which included cutting its headcount. Additionally, Ibstock permanently closed its brick factory in South Holmwood, Surrey.

Revenue decreased by 21% to £405.8 million from £512.9 million in 2022, as Ibstock saw ‘significantly lower activity levels’ in its core residential building markets.

Earnings per share were down 75% to 5.4 pence compared to 21.6p the previous year.

In response, Ibstock cut its final dividend to 3.6 pence per share from 5.5p, leaving its annual dividend down by 20% to 7.0p per share from 8.8p a year prior.

Looking ahead, Ibstock noted that trading at the start of 2024 has been subdued, but it said it expects to see an improvement later in the year.

Shares in Ibstock were down 3.9% at 155.50 pence each in London on Wednesday morning.

Copyright 2024 Alliance News Ltd. All Rights Reserved.