Forterra (LSE:FORT) reported a 13.5% decline in first-half revenue to £168.80 million as demand across the UK construction sector remained subdued, weighing on sales across its core product portfolio.
Adjusted EBITDA decreased 9.7% to £27 million during the period. However, the company achieved an improvement in its EBITDA margin following the disposal of non-core operations, helping to partially offset the impact of weaker trading conditions.
The fall in revenue reflected softer demand across several key product categories. Brick despatches declined modestly, while sales of concrete block products experienced a more pronounced reduction. To help offset rising input costs, including those linked to disruption caused by the Middle East conflict, Forterra introduced low single-digit price increases on bricks and applied additional surcharges across its wider product range.
The company also implemented production cuts and completed a restructuring of its management and support functions, with the measures expected to generate annual cost savings of approximately £2 million. During the first half, Forterra continued executing its £20 million share buyback programme as part of its capital allocation strategy.
Looking ahead, management expects market demand in the second half of the year to remain broadly consistent with first-half levels, supporting full-year results in line with current market consensus. However, the company cautioned that forecasting demand remains challenging given ongoing geopolitical uncertainty and broader macroeconomic pressures affecting the construction industry.
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