Ibstock (2I5) Q2 2026 Earnings Report

The call presents a mixed picture: meaningful near‑term financial weakness with double‑digit revenue declines, materially lower EBITDA and EPS, elevated leverage and negative H1 cash flow, counterbalanced by clear strategic progress — product innovation (Nostell, Atlas), commercial wins in infrastructure, a strengthened manufacturing base, and material optionality from land and calcined clay. Management expects H2 improvement and longer‑term value drivers are credible, but near‑term execution and market recovery risks remain significant.

Ibstock guided that, despite a challenging market, it expects stronger adjusted EBITDA in H2 than H1 and a full‑year outcome around the lower end of current market expectations, with net debt of £151.3m and leverage of 2.5x at the half‑year expected to reduce towards ~2x by the end of 2026; H1 revenue was £164.2m (‑15% reported, ‑10% like‑for‑like) with adjusted EBITDA £25.7m (H1 2025: £35.5m), adjusted EPS 0.7p (vs 3p), an interim dividend of 0.5p, and adjusted free cash flow outflow of £22.3m (working capital outflow £17.3m); H1 clay revenue was £119.9m (core £118.1m, ‑8% LFL) with clay adjusted EBITDA £23.4m (19.5% margin) and a ~£5–6m deliberate EBITDA headwind from capacity/inventory actions, concrete revenue was £44.3m (‑26% reported, ‑11% LFL) with adjusted EBITDA £3.7m (8.3% margin), CapEx was £15.2m (c.£4m growth, £11m sustaining) and going forward sustaining CapEx is expected c.£20–25m; the June temporary energy/fuel surcharge (plus the Feb price increase) is expected to flow through for H2 with no further price rises planned, clay volumes are expected to improve low single digits H1→H2 (with production flexing if needed — c.45–55m fewer bricks in H2 vs H2 last year), Nostell/Futures net costs were £2.5m (orders in the low millions, enquiries in the tens of millions), and the group expects pricing actions and the normalization of CapEx and working capital to support deleveraging.