Forterra's Share Buyback Announcement#
Forterra, a manufacturer of bricks and concrete, has announced a £20 million share buyback program. This buyback represents about 6% of the company's market value. The decision comes despite challenges posed by unfavorable weather conditions that have impacted sales volumes.
Financial Performance and Outlook#
For the fiscal year 2025, Forterra reported earnings before interest, taxes, depreciation, and amortization (EBITDA) of £61.6 million, which aligns with market expectations. Looking ahead to fiscal 2026, the company anticipates adjusted EBITDA to be slightly higher than the previous year, with current analyst estimates around £63 million, indicating a modest growth of about 2% year-over-year.
Impact of Weather on Sales#
The company has faced significant challenges due to exceptionally wet weather in January and February, leading to a decline in deliveries by a high single-digit percentage compared to the same period last year. Forterra is currently assessing how much of this decline is due to weather disruptions versus a general softness in demand for its products.
Future Expectations and Debt Management#
Management now expects sales volumes for fiscal 2026 to remain flat compared to the previous year, with demand anticipated to be stronger in the latter half of the year. The buyback program follows Forterra achieving its target leverage ratio, with net debt to EBITDA at 1x at the end of fiscal 2025. The company expects its net debt levels to remain stable through fiscal 2026 and has indicated that share buybacks could continue in the coming years.