Forterra has warned customers to prepare for a fourth rise in brick prices within 12 months, as the supplier continues to react to cost inflation.
In a trading update for the 10 months to October, the brickmaker said an anticipated increase in the New Year would follow previous rises in January, April and most recently in October, when most of the company’s bricks saw a price hike of 16.5 per cent.
Group revenue during the period was 23 per cent ahead of the previous year on the back of the price increases, Forterra said, and full-year results were expected to be in line with management expectations.
Outgoing chief executive Stephen Harrison said trading remained “robust”, but that the company was watchful of the impact of recent instability in the financial markets on the housing sector.
“The group enters this uncertain time in a position of strength, having a strong balance sheet with low levels of debt and high levels of cash generation,” he said.
“Inventories remain at record low levels and despite the current uncertainties we remain well-placed to mitigate the effects of a softening of demand by substituting imported bricks with domestically manufactured product.”
The company also said that Harrison, who announced earlier this year his plan to step down after a decade at the helm, would be replaced by Neil Ash, head of building performance at Belgian lightweight-building-materials manufacturer Etex.
Chairman Justin Atkinson said Forterra would benefit from Ash’s three decades of experience in the building-materials sector, including the oversight of major capex projects, significant acquisitions and the development of a sales approach that had delivered strong top-line growth.
Ash, who is expected to begin his new role in April, also spent 15 years at Lafarge, where he served as vice-president for international business development and sales, and as commercial director for UK and Ireland for Lafarge Plasterboard.
“His business leadership and extensive building-materials sector knowledge will be invaluable to Forterra in the next stages of our development, and the board looks forward to working with him,” said Atkinson.
Forterra also confirmed that the commissioning of its new Desford brick factory was “progressing” and should be delivered early next year within its original £95m budget, while its factory in Wilnecote – the £27m refurbishment of which was delayed due to supply chain disruption – was expected to open next October.