The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Nah don’t think so
Had wanted to buy this but will wait for 60p or less
Something rumbling underneath or just market sentiment? up nearly 4% today
Have to be a big firm surely.
Breedon made a few acquisitions over the years
Takeover imminent?
I am glad I held on...
Nothing wrong with the news today except an unrealistic share price. Can we leave the AIM mentality and get on to the grown up market.
Any prospects of introducing graphene into their concrete? Versarien and Directa Plus should be knocking on their door!
Trencherpilot, reading my post again I think I've underplayed the point you make about diesel prices.
Managing diesel pricing through the pressures mounting on that particular oil component this winter will be a challenge for the industry. I understand Breedon's hedging activity operates on a rolling basis so that might provide some relief, particularly in competition with smaller players who may not have a hedging strategy. But ultimately, it will come down to the level of price increase they can implement.
In the coming update we'll get revenue numbers, but I'd be disappointed if there isn't some commentary on pricing and margins too.
Trencherpilot, good to hear you're busy in concrete, but I suspect that might be a local (East Midlands) effect. Across GB mineral product sales have been in decline for the last 5 years (MPA link below). The fact is that in spite of the political noise we don't build much in the UK.
Your post prompted me to lookback to the 2017 results presentation because I remembered it included a breakdown of Breedon's internal supply chain. In 2017 41% of Breedon's cement production went into their concrete production of 3.3M m3. This cement would have come from their Hope plant, with the balance going to other concrete producers and other uses, bagged, mortar, etc.
But I noticed that in 2021 GB concrete production was 3M m3, down 10% on 2017. Clearly, Breedon's business wouldn't have grown on those numbers - the shortfall has been made up with c. 60% growth in asphalt and aggregate. In acquisitions Breedon has been required to sell or shut-down RXC plant to satisfy the CMA's competition concerns.
The lower demand for concrete is largely due to the reduced building of commercial office space, although in areas like the East Midlands that may be offset by the growth private industrial buildings, e.g., logistical centres, which has been growing at over 50% p.a. for the last 5 months.
I'd be interested to know what mix you see and any recent change in your concrete supply to infrastructure, house builders and industrial or commercial buildings.
On fuel increases, roughly 50% of the increase over the last year is due to the change in the rules on red diesel (47p/Lt), which was at least known about by Breedon.
Going back to mineral volumes I was surprised by Breedon's comment that H1 volumes were down by 6% compared to last year. I guess it highlights the bounce back from Covid early 2021, which subsequently tailed off into this year. However, in spite of the decline in the recent Q3 volumes, the decline is much less than it was in 2021 Q3. I might be over reading it but given the 2021 H2 improvement in financial terms in 2021 H2 if not in volumes, then we might see something similar in the current half, 2022 H2.
The trading update on the 25th should answer some of these queries.
https://mineralproducts.org/News-CEO-Blog/2022/release35.aspx
Breedon make their own cement in the Hope Valley. Most aggregates when I operate from are dug from one of two Breedon quarries less than 20 miles away. These two, supply sand and gravel into Notts, Leics and Lincs. The only products Breedon buy are admix for the concrete. Not sure if this is replicated across the UK. Unfortunately due to Putins actions, the truck and plant fuel bills have doubled. (My truck has gone from 140 a day fuel to 280 plus adblue) However in the East Mids we have been busy all summer and are still relatively busy even now when it usually really quietens down.
I agree. Clearly building volumes will fall in the next year and energy costs are up (with French cement companies being supported by the Govt) but surely a falling pound and a disciplined company, with adequate cash, should be able to weather this and be perfectly positioned when the market picks up. The sell off, when compared to the builders, seems overdone.
I assume the next TU will be in early November. Has anyone seen any recent industry news relevant to BREE?
Amazed to see this break 50p today, feels like an overdone sell off. Housing market and build projects being shelved may impact the bottom line, but house builders don't seem to be suffering as badly as Bree.
Is this as low as it will go or is there worse to come?
The sp has almost halved in the space of 1 year. I was speaking to a former AIM 100 MM recently. He claimed he could often swing an AIM sp by 10-20% either way with just £10k. That would certainly explain a lot. Breedon needs to get out of AIM and get listed on the main market. I don't think it will be taken seriously until it does. It is baffling why it hasn't done so already, given that it is a well managed company and could easily fulfil all of the listing criteria.
L3T
My comment was a little tongue in cheek but overall I do see value at these prices
12 months ago we were twice todays levels -yes I understand things have changed over that period but the guys running this business are not novices and cost control within the quarrying industry has alway been tight
Prices have increased and more importantly held
Therefore in my opinion the price is low and perhaps why a director is increasing his position
The government has stated a willingness to increase on infrastructure (holding my breath on that one) but hopefully we can build from hear
All above just my opinion but GLA
what do you see Megan?
Looks like Jude has followed my lead another 40k buy
We can both see the same thing
G L A
Nearly 3m shares purchased at 13:50 today
Interesting?
I have a plan to help you all out
I sell all my holding then the price rises which is what normally happens to me , I have achieved this twice now !! In one instance rising 3x
I do understand market sentiment but surely this is over done now
The bad news for you all is I will be retaining my shares -just hope the market can see what Jude and I can see!!
Good luck everybody
//What does Jude Lagan, Managing Director - Breedon Cement see that prompts him to add to his holding?//
Why wouldn't he buy more at these bargain basement prices. It can't go any bloody lower (Ihope!).
the SP hasn't been this low since about 5 years ago. hard to comprehend.
It can only be positive that he has increased his holding
What does Jude Lagan, Managing Director - Breedon Cement see that prompts him to add to his holding?
Breedon's share price can't withstand market forces but nice to know (I assume) that Jude Lagan sees good operational performance within Breedon.
Yea I know, why he bought on the 24th