The so-called ‘chase for space’ among householders forced to work from home because of the pandemic shows no sign of slowing down, the boss of listed brickmaker Michelmersh has said.
Frank Hanna added around half of the firm’s product was being shipped to cater for the booming RMI market with the remainder split between housebuilders and new build schemes.
A surge in DIY, driven by people looking to reconfigure their homes in the wake of successive lockdowns, is sending demand for bricks at the firm, which produces around 120 million a year, rocketing. Hanna said: “Certainly going into Q4 and Q1 next year, the pace of demand is consistent.”
Michelmersh stocks are expected to be lower in the second half of this year, a combination, Hanna added, of production cycles and some firms taking more product than expected.
Michelmersh’s clients include builders merchants Jewson and Travis Perkins along with housebuilders Crest Nicholson and Berkeley while it has also worked on the Battersea Power Station redevelopment in London.
Yesterday, the firm said income in the first six months of the year was up one third to £30m with pre-tax profit jumping 150% to £5m from the same period last time when its bottom line was ravaged by the first lockdown last spring.
Hanna said the firm expected its financial numbers in the second half to be down on those in the first six months of the year with the company warning it was taking a cautious approach on the impact of covid on its 360 staff.
“The pingdemic has caused us problems,” Hanna admitted. “We have very covid secure factories but we have to be mindful of what the situation was like last year.”
He added Michelmersh is also having to juggle a shortage of lorry drivers and trucks to get its products to builders merchants. “We use our own transport and external hauliers. It has got more challenging but it hasn’t affected our performance.”
Analysts are expecting the firm’s 2021 results to see revenue of around £57.5m, up 10.5%, and pre-tax profit of around £9.5m, up from £6.9m last time.