Brick maker Forterra (FORT) has warned that operating profits for 2018 are expected to be between £2m and £3m lower than previously forecast following the overheating and the six-week shutdown of a kiln.
The Desford brick manufacturing facility will be shutdown for six weeks of repairs, after a detailed inspection found that the damaged section would require a complete rebuild. However, demand for bricks has been underpinned by construction in the residential housing sector, while capacity utilisation has increased with the recently acquired Bison Swadlincote facility, and further productivity improvements are under way.
The group has had to absorb significant cost pressure from rising fuel and energy costs, but with output at full capacity it is generating strong cash flow, which helped to reduce debt from £60.8m at the start of the year to £56.1m.
