Ibstock sells US business to focus on core UK market

Ibstock has sold its US brick manufacturing business Glen-Gery to Brickworks Limited for £85m.

Ibstock said the proceeds of the deal will be used to help pay down debt to around £50m by the end of this year.

Chief Executive Officer Joe Hudson said it would help Ibstock focus on its core UK market.

Hudson said: “At the interim results in August we announced that we were undertaking a strategic review of certain aspects of our business, including our US operations.

“We have concluded that opportunities to grow the US business are not in line with our overall strategic objectives, and the decision was taken to dispose of these assets and refocus the Group on its core markets here in the UK.

“This divestment augments our strong underlying cashflow generation, leaving us with a strong balance sheet.

“Our capital allocation and shareholder return priorities remain unchanged, and we continue to assess both organic and inorganic investment options in the UK as we look to deliver long term growth.”

Ibstock said its enhanced maintenance program in its UK brick business is progressing well and the group remains on course to deliver adjusted EBITDA of £121m to £125m for the year ended 31 December 2018.

It added: “Whilst the uncertainty around the ongoing negotiations for the UK’s withdrawal from the EU persists, the market backdrop in the new build housing sector remains positive.

“We will provide a further trading update for the year ended 31 December 2018 on 17 January 2019 as planned.”

from Construction Enquirer http://www.constructionenquirer.com/2018/11/23/ibstock-sells-us-business-to-focus-on-core-uk-market/

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