Ibstock falls after longer brick supply chain blockage
Brick maker Ibstock said the slow start to the year for its UK clay business had lasted fourth months before reaching a positive plumb-line.
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The FTSE 250 group said UK brick sales into the key new residential sector have grown but were slowe than expected due to destocking in the builders merchant supply chain.
Monthly trading comparatives have now moved positive and the sales team has managed to secure mid-single digit headline price increases.
"The change in channel mix during the first four months of the year has impacted overall average pricing," Ibstock said in a statement ahead of its annual shareholder meeting. "We anticipate that the channel mix will see further improvement as the year progresses."
Helped by the US housing recovery, the clay brick business there has maintained its good start to the year, while strong demand for concrete products has helped that side of the business continue its positive start across the fist four months of 2016.
Looking forward, demand for new housing seems robust and so management are confident market fundamentals remained positive in both the UK and US.
"The board expects another year of progress for the group and its expectation for the full year is broadly unchanged."
Shares in Ibstock, havign on Wednesday hit a record high above 226p, fell 10% to 201.43p by late morning on Thursday.