2023 sales dropped 24pc for brickmaking group
Brickmaking group Forterra, which has one of its factories in the Black Country, has reported a fall of around 24 per cent in sales for 2023.
The manufacturer of clay and concrete building products said revenue was down from £455 million in 2022 to around £345m.
Despite the continued challenging market conditions Forterra, which has its Cradley Special Brick factory at Corngreaves Trading Estate, Cradley Heath, expects to report full year adjusted earnings before tax slightly ahead of board expectations.
The impact of falling sales volumes was partially offset by pricing benefits.
Figures published by the Department of Business and Trade highlight that UK brick despatches in the three-month period to November were 33 per cent lower than the same period in 2022.
Forterra deliveries fell by a greater percentage driven by its exposure to volume housebuilding which suffered the greatest impact from rising interest rates.
Strong management actions during the year will deliver annualised fixed costs savings in excess of £20 million with around £6m realised in 2023 with the balance in 2024. One-off cash restructuring costs are expected to total £9m of which £4m will be paid in 2024.
Faced with increasing inventory levels, Forterra made further reductions to production during the second half of 2023 which, assuming 2024 demand remains consistent with 2023, will ensure output is aligned with sales.
Production has been reduced through the mothballing of factories, shift reductions and production breaks.
Forterra sasy the outlook for the industry remains subject to considerable uncertainty and, with a general election expected in 2024, demand is anticipated to remain subdued in the near term.
The group will announce full 2023 results on March 26.
