26 March 2024
Michelmersh Brick Holdings Plc
(“MBH”, the “Company”, or the “Group”)
Preliminary results for the year ended 31 December 2023
Positive performance – earnings ahead of market expectations
Michelmersh Brick Holdings Plc (AIM: MBH), the specialist brick manufacturer and brick-fabricator, reports its preliminary results for the year ended 31 December 2023.
Financial Highlights:
| 31 Dec 2023 | 31 Dec 2022 | Change | Organic change 2 | ||
| Statutory results | |||||
| Revenue | £77.3m | £68.4m | 13.0% | 1.3% | |
| Gross margin | 38.9% | 39.4% | (0.5%) | 0.6% | |
| Operating profit | £12.3m | £11.6m | 6.0% | 5.2% | |
| Profit before tax | £12.5m | £11.4m | 8.8% | 8.1% | |
| Basic earnings per share | 10.44p | 9.41p | 10.9% | 10.2% | |
| Cash from operations | £13.6m | £19.7m | |||
| Net cash | £11.0m | £10.6m | |||
| Dividend per share | 4.50p | 4.25p | 5.9% | – | |
| Adjusted results* | |||||
| Adjusted EBITDA1 | £17.8m | £16.7m | 6.6% | 4.8% | |
| Adjusted operating profit | £13.7m | £12.7m | 7.9% | 7.1% | |
| Adjusted profit before tax | £13.8m | £12.5m | 10.4% | 9.6% | |
| Adjusted earnings per share | 11.91p | 10.61p | 12.3% | 11.6% | |
Highlights:
· Positive financial performance in 2023, with earnings for the year ahead of market expectations
· Revenue and profit growth driving 11% increase in Basic EPS
· Continued focus on pricing stability for customers to support 2024 demand outlook
· Full production capacity maintained throughout the year alongside focused cost management has led to strong profit performance
· Resilient operational cash generation supported investment in inventory and capital investment in solar at plants to supplement longer term energy requirement
· Launch of SustainableBrick.com, a new website that highlights the benefits of clay brick to our broad customer base
· Group cash of £11m at 31 December 2023 and undrawn £20m borrowing facility underpin strong financial resources and strategic optionality
· Final dividend per share of 3.00p resulting in full year dividend of 4.50p, up 5.9% on 2022, demonstrating commitment to progressive dividend policy and confidence in a resilient outlook
Outlook:
· Focus on maintaining a well-balanced forward order book and pricing stability expected to support resilient order intake across our diverse end market customer base for 2024
· Energy price hedging in place with over 70% of our expected requirements secured for 2024 with the expectation of a more stable outlook expected to underpin forward prices
· The Group continues to focus on delivering both excellence in product and customer service and with the resilient qualities of our business model the Board remains confident in the strategic outlook of the business.
Commenting on the results, Martin Warner, Chairman of Michelmersh Brick Holdings Plc, said:
“I am very pleased to report on another positive year for the Group, with strong growth across our key financial metrics despite the decline in the broader construction industry.
“We enter 2024 watchful of the interest rate environment and inflation trends and how these affect the timing of the anticipated increase in construction activity levels. Whilst we continue to closely monitor the impact from these macro cycles, we believe in our business model, maintaining a broad customer base across multiple end markets, and continue to see robust levels of order intake as a result.
“As ever, the Group continues to focus on delivering both excellence in product and customer service and with the resilient qualities of our business model the Board remains confident in the strategic outlook of the business.
“As I step down from the business after 35 years of involvement with brick making I would like to thank all my colleagues who have supported me over the years, past and present. The growth from small beginnings has only been possible by their dedication, skill and support in good times and bad.
“I have no doubt that all that has been built in terms of plant and people will mean that the business will continue to prosper from a strong financial base for shareholders, customers and importantly for our employees who make it all happen. This business is truly unique in many ways.
“I would also like to add my personal thanks to Frank Hanna as he steps down for pastures new. We have worked together in the industry for many years, particularly since the acquisition of Freshfield Lane in 2010. He has been a valued colleague and I wish him every success in the future.“
*The Directors believe that adjusted measures provide a more useful comparison of business trends and performance. Adjusted results exclude exceptional items which include costs associated with acquisitions and the amortisation of acquired intangibles. The term adjusted is not defined under IFRS and may not be comparable with similarly titled measures used by other companies. .Adjusted performance results are reconciled with statutory results in the table below.
1 EBITDA is defined as earnings before interest, tax, depreciation and amortisation
2 Organic change presents a percentage comparison year on year excluding the impact of the results of FabSpeed which was acquired on 24 November 2022.
An analyst briefing will be held virtually at 11:30am today. To attend please email michelmersh@yellowjerseypr.com.
The Company also notes that it will be hosting an online presentation to retail investors on Thursday 28 March at 10:00am. Those wishing to join the presentation are requested to register via the following link: Meeting Registration
| Michelmersh Brick Holdings PlcPeter Sharp, Chief Executive OfficerRyan Mahoney, Chief Financial Officer | Tel: +44 (0)1825 430 412 |
| Canaccord Genuity Limited (NOMAD and Joint Broker)Max HartleyBobbie HilliamHarry Pardoe | Tel: +44 (0)20 7523 8000 |
| Berenberg (Joint Broker)Richard BootleDetlir EliziPatrick Dolaghan | Tel: +44 (0)20 3207 7800 |
| Yellow Jersey PRCharles GoodwinAnnabelle Wills | Tel: +44 (0)7747 788 221Tel: +44 (0)7775 194 357 |