Brickability eyes deal strategy to enhance proposition

Brickability Group PLC businesses are focussed around three core product areas; Bricks and Building Materials, Roofing Products and Services as well as Heating, Plumbing and Joinery.

The group distributes, and in many cases installs superior quality and strategically important building materials from major UK and European manufacturing partners, providing product solutions to both private and commercial specifiers, contractors, developers and builders.

The group is a market leading supplier of facing bricks, blocks, rainscreen cladding systems, architectural masonry, paving, roof tiles and slates to the construction industry.

() won the AIM ‘Transaction of the Year Award’ at this year’s AIM Awards.

The AIM Awards celebrate companies that have made outstanding achievements on the world’s most successful growth market, recognising the quoted companies and entrepreneurs who have harnessed AIM to help them fulfil their ambition and growth potential in the last 12 months.

The award recognised Brickability’s acquisition of fellow building materials supplier Taylor Maxwell, which was completed in June.

Alan Simpson, CEO of Brickability, said: “We are delighted to have won ‘Transaction of the Year 2021’. The acquisition of Taylor Maxwell has been an ambition of ours since listing in 2019 given the strong strategic and commercial fit of the business. The completion of such a transformational transaction will enable us to continue to expand and enhance our presence within the UK marketplace, further strengthening the business as we move into 2022.”

() reported a 200% year-on-year rise in first-half revenues as the construction materials specialist confirmed its order book remained buoyant and that it is “well placed as demand continues to strengthen”.

Chairman John Richards added: “The UK housebuilding market has shown its resilience in recent months as the UK builds new homes at one of the fastest rates since the turn of the century.

Brickability Group PLC (AIM:BRCK) (AIM:BRCK) highlighted a strong recovery since the initial Covid-19 lockdown as it reported results for the twelve months ended March 31.

Group revenue for the year was reported at GBP181.1mln, versus GBP187.1mln in the prior year, and the group noted that like-for-like revenues declined by 13.2% due to restrictions on trading during the period. Earnings (adjusted EBITDA) meanwhile totalled GBP17.5mln, compared to GBP19.5mln in 2020.

() had an ‘excellent’ first half, according to City broker Cenkos in the wake of a trading statement that revealed revenues were up 200% year-on-year for the building materials distribution specialist.

“[This] demonstrates again its management credentials to operate strongly in all industry scenarios and its ability to identify, execute and add value through acquisitions, the update serves as a reminder as to why we believe this is a good investment,” the broker said in a note to clients.

It pointed out that Brickability currently trades on an enterprise multiple of less than eight times and a price-to-earnings multiple of 11-times. A well-covered dividend, meanwhile, generates a yield of 2.3%, while the free-cash-flow yield is 8.5%. It reckons fair value is 126p a share (current price 104p).

() () John Richards joins Proactive London to talk about winning the AIM ‘Transaction of the Year Award’ at this year’s AIM Awards.

The award recognised Brickability’s acquisition of fellow building materials supplier Taylor Maxwell, which was completed in June.

The AIM Awards celebrate companies that have made outstanding achievements on the world’s most successful growth market, recognising the quoted companies and entrepreneurs who have harnessed AIM to help them fulfil their ambition and growth potential in the last 12 months.

Brickability is a leading supplier of bricks and other building materials to the UK construction industry, and is well-positioned to consolidate the fragmented UK building products supplier space. The company has undertaken four acquisitions since its IPO in 2019, which adds to some twelve acquisitions carried out previously in the years since it was founded in 1984. As a result of this acquisition process, the group has branched out from its core bricks and building materials distribution into the adjacent areas of roofing products and services as well as heating, plumbing and joinery. These moves make compelling strategic logic, as the divisional businesses enjoy a common customer base, and hence provide a simpler procurement process for its customers. Further, the new areas also enjoy significantly higher margins.