Forterra Regulatory News (FORT)

21 May 2024

FORTERRA PLC

2024 AGM Trading Update

Continuation of challenging trading conditions, full year guidance maintained

Ahead of our AGM which is to be held at 12.00pm today, Forterra plc (the 'Group'), a leading UK manufacturer of essential clay and concrete building products, provides its trading update for the four month period ended 30 April 2024 (the 'Period').

Trading conditions throughout the Period remained challenging with depressed activity levels persisting across our key markets, in part driven by the exceptionally wet weather experienced in the first quarter. 

Group revenue in the Period was 6% below the prior period comparative. This is consistent with our assessment of demand in the domestic brick market as informed by data from our trade association and the Department for Business and Trade.

Alongside this, imports of bricks to the UK in the first three months of the year, as published by HMRC, fell by 24% relative to the prior year, continuing the decline seen throughout 2023. 

Notwithstanding the challenging market, our continued focus on cost control and commercial discipline have allowed us to mitigate the impact of lower than expected sales volumes during the Period.

Looking ahead, whilst overall trading conditions remain challenging, we have seen modestly improved levels of activity through April and into May with improving demand for both flooring and foundation products providing tentative indications of increasing build rates and improving demand as the year progresses.

Accordingly, subject to a continuation of the recently observed improvement in activity, our full year expectations remain unchanged, with a greater weighting towards H2 than previously guided.

Neil Ash, Chief Executive of Forterra plc, commented:

"Whilst the Group continues to experience weak market demand, I am pleased that the decisive rationalisation and cost saving actions we implemented in 2023, along with continued commercial discipline and operational agility, has allowed us to mitigate the effects of a weaker than expected market at the beginning of the year.

We continue to make progress with our strategic investment projects at Wilnecote and Accrington and the Group remains well positioned to capitalise as soon as our markets recover."