Higher brick prices help push profits by 30% as sales volumes drop in softening market.
Brick-maker Baggeridge has increased pre-tax profit by 30% for the year ending 30 September despite a fall in sales volume. The firm says that higher prices and improved production efficiencies at two of its factories helped to increase pre-tax profit from £6.1m to £8m on a turnover of £52.8m.
Chairman Alexander Ward said: 'Sales volumes since the year end have been lower than the unusually strong corresponding period of the previous year.”
Baggeridge said that the second half of the year was affected by a softening of the market, lower stock availability and a loss of production at its Kingsbury factory caused by a kiln refurbishment programme.
Despite the upgrading work profits from Kingsbury rose substantially according to the company. The company said that only its Rudgwick factory had a difficult year, which it blamed on the sluggish housing market in the South East.
Ward said the current financial year would be affected by significantly higher energy costs. He said:”Inevitably, there will be some time lag in the recovery of these costs through higher prices. With the market also cooling, a reduction in first half profit should be expected.”
However, Ward said that national brick stocks were at their lowest level since 1989 and this, together with the company’s recent investment programme, should stand it in good stead for the future.