BRCK Group (BRCK) H1 2025 earnings summary

Executive summary

• Revenue increased 1.9% to £330.9m in H1 FY25, with adjusted EBITDA up 9.0% to £27.9m and margin rising to 8.4%, despite challenging UK construction markets and a like-for-like revenue decline of 7.4%.

• Diversification strategy drove resilience, with strong Contracting and Distribution performance, including a doubling of solar PV sales at Upowa and robust cladding/fire remediation activity.

• Interim dividend increased 4.7% to 1.12p per share, reflecting Board confidence in the long-term outlook.

• Acquisitions of Topek and TSL in specialist cladding and remediation are performing in line with expectations and contributing to higher margins.

• Statutory profit before tax fell to £7.0m due to £15.0m in non-underlying items, including a £5.3m impairment of a joint venture loan.

Financial highlights

• Revenue rose to £330.9m (+1.9% YoY); gross profit margin increased to 19.0% (+210bps YoY); adjusted EBITDA margin improved to 8.4% (+50bps YoY).

• Adjusted profit before tax was £21.9m (+0.5% YoY); adjusted EPS was 5.03p, down 5.1% YoY.

• Net debt increased to £56.3m (H1 FY24: £30.9m), mainly from working capital, tax, and acquisition-related outflows.

• Operating cash flow before working capital rose to £26.3m; cash generated from operations £19.3m.

• Interim dividend of 1.12p per share (+4.7% YoY); £7.3m paid in dividends in H1.

Outlook and guidance

• Trading in early H2 is in line with Board expectations; Board confident in meeting FY25 market expectations of £630m revenue and £47m adjusted EBITDA.

• Profitability expected to be first-half weighted due to project phasing in Contracting.

• New build housing market remains soft, but medium-term fundamentals are strong due to a structural housing deficit and government commitment to 1.5 million new homes.

• Recent order intake and enquiries are encouraging, especially in Bricks and Building Materials.

• Board remains confident in achieving FY25 market expectations.