Forterra report strong performance in 2017
Group makes good progress with strong growth in profit and cash in first full year as a listed company
FORTERRA, one of the UK’s leading producers of manufactured masonry products, have reported strong profit and cash performance in their first full year as a public company, largely due to strong demand in the new-build residential market.
Established in 2015 from the building products business of Hanson UK and floated on the London Stock Exchange in April 2016, Forterra currently operate from 18 manufacturing sites and have strong market positions in clay bricks and concrete blocks. They also have a leadership position in the precast concrete products market having acquired the Bison business in September 2017.
For the year ended 31 December 2017, the Group reported a 12.4% (10.4% excluding Bison) increase in revenue to £331 million (2016: £294.5 million), whilst pre-tax profit rose sharply from £37.1 million in 2016 to £59.3 million last year on the back of double-digit increases in brick and block volumes. In addition, strong cash flow performance resulted in a £31.5 million reduction in net debt to £60.8 million, representing 0.8 times adjusted EBITDA.
Stephen Harrison, chief executive officer, commented: ‘Forterra delivered a strong profit and cash performance in 2017, our first full year as a listed company. Revenue was up over 10%, primarily due to a strong performance from the new-build residential market, and we also completed the strategically important acquisition of Bison, which has given us a leadership position in the precast concrete products market.
‘Following our strong performance in 2017, the current year has started well with brick volumes for the first two months ahead of the comparable period last year. Whilst the housing maintenance and improvement market remains subdued, we continue to see good activity levels from the new-build residential market and anticipate a more modest level of volume growth compared with the prior year.
‘Based on our order book and indications from major customers, our expectations for 2018 are unchanged. Whilst we are cautious of the impact of the current uncertainty on the UK economy, the board remains confident that the business is well positioned to take advantage of the attractive market fundamentals and of its ability to deliver sustainable shareholder value.’
