2021 has “started well” at Ibstock, the Leicestershire-headquartered manufacturer of clay bricks and concrete products, with trading “modestly ahead of expectations.”
According to a trading update for the first quarter of FY 2021, the company has witnessed robust demand from both the new build housing and Repairs, Maintenance & Improvement (RMI) end markets.
Sales volumes in the Clay division for the first quarter were ahead of internal expectations, whilst Concrete volumes for the quarter were in line with internal expectations.
Ibstock has also revealed it is recommencing the project to redevelop its Atlas site in the West Midlands, replacing the existing mothballed facility with a new state-of-the-art wire cut clay brick factory.
The Atlas project has been revised and expanded since the announcement of the original proposal in early 2020, with an increase in capacity and further significant enhancements to deliver improved environmental performance.
The project also includes investment to upgrade and expand capacity at the adjacent Aldridge brick factory.
Ibstock believes that the Atlas site will be the first net-zero brick-manufacturing facility in the UK.
In total, the redeveloped facilities will deliver capacity of 115 million bricks per annum, equivalent to a net increase in Ibstock Clay’s network capacity of 75 million bricks, after taking into account the existing capacity of the (mothballed) Atlas factory.
The total capital cost of the project, which is subject to final planning permission, will be £60 million, with both the new Atlas factory and the upgraded Aldridge factory expected to begin commissioning in the second half of 2023.
Joe Hudson, Chief Executive Officer of Ibstock, said: “We’ve made an encouraging start to 2021, supported by robust demand in both the new build housing and RMI markets.
“With the market outlook now clearer, we are refocusing on growth. Redevelopment of our wire cut brick facilities in the West Midlands will deliver a significant capacity expansion, further demonstrating our leadership in the clay brick market, which is expected to continue its long-term growth over time.
“The project is another tangible example of our commitment to the net zero carbon journey and provides a great exemplar of British building products manufacturing.
“We have a number of additional organic investment opportunities under evaluation and expect to update shareholders on these as the year progresses.”