Ibstock (IBST) H2 2024 earnings summary

Executive summary

• Delivered resilient performance in 2024, with adjusted EBITDA in line with expectations despite challenging market conditions and a 10% revenue decline year-over-year; H2 saw improved demand and market share gains supported by strong service and supply proposition.

• Strategic investments in innovation and sustainability, including major capital projects and new product development, are nearing completion, positioning for market recovery.

• Innovation team drove new and sustainable products to 22% of 2024 revenue, up from 11% in 2023.

• Free cash flow improved with disciplined working capital management.

Financial highlights

• Revenue for 2024 was GBP 366 million, down 10% year-over-year due to lower sales volumes in the core business.

• Adjusted EBITDA was GBP 79 million, 26% below the prior year, with a margin of 21.7%.

• Net debt increased to GBP 122 million (2023: GBP 101 million), reflecting continued capital investment; leverage at 1.8x.

• Dividend per share reduced to GBP 0.04 (2023: GBP 0.07), representing 52% of adjusted earnings.

• Cash conversion improved to 71% from 47% in the prior year.

Outlook and guidance

• Early 2025 trading solid, with sales volumes ahead of prior year; market volumes expected to increase through 2025.

• Mid-single-digit price increases implemented from March 2025.

• Sustaining and growth capex each expected to be around GBP 20 million in 2025; effective tax rate to stay at 26%.

• Underlying depreciation to rise slightly to GBP 34 million, interest expense to remain flat at GBP 9 million.

• Medium-term targets: revenue over GBP 600 million, group margins at least 28%, ROCE over 20%.