UK sales slump deepens as largest brickmaker warns housebuilding downturn is biting

Sales and profits fall

Ibstock said sales dropped by more than a fifth over the summer. It also reported a 17% year-on-year decline in UK brick market volumes during July and August, followed by continued weakness in September and October.

The company said annual profits would be materially below earlier expectations. It now forecasts a result in the mid-£40m range, compared with analysts’ previous consensus of £59m. This is Ibstock’s second profit warning this year.

Government support criticised

Ibstock criticised the government for not moving faster to provide new support for the housing sector. It also objected to the decision not to delay the start of a scheme intended to help first-time buyers in England purchase a new-build home with a 2.5% deposit. The company’s warning came days after the Office for Budget Responsibility reduced its forecast for the number of new homes to be built by 2031 by 190,000.

Shares and cost controls

Ibstock shares fell by more than 8% after the announcement. The company said its cost-saving and cash-management efforts were focused mainly on overheads and discretionary spending. Ibstock has cut production by a fifth, reflecting the weaker market. Its warning points to continued pressure on the brickmaker as housing activity remains subdued.