Michelmersh Brick Holdings PLC

("MBH", the "Company", or the "Group")

Preliminary results for the year ended 31 December 2025

Performance impacted by broad external market conditions and the operational improvements alongside delivery of capital allocation policy

Michelmersh Brick Holdings Plc (AIM: MBH), the specialist brick manufacturer, reports its preliminary results for the year ended 31 December 2025.

Financial Highlights:

Financial, Strategic and Operational Highlights:    

Financial performance

Operational re-organisation

Continued delivery of capital allocation policy

Outlook

Board Changes

·      Rachel Warren is stepping down from the Group Board with immediate effect due to personal reasons and will be leaving the Company in May 2026 prior to the AGM and following a hand over of her duties as CFO. Ryan Mahoney, CEO, will assume the responsibilities of CFO on an interim basis, reassuming the roles and responsibilities he carried out for the majority of 2025 supported by an experienced wider leadership team. Ryan previously held the role of CFO between 2021 and 2025.

Commenting on the results, Tony Morris, Chair of Michelmersh Brick Holdings PLC, said:

"Broader UK brick despatches started 2025 with a positive year on year trajectory but this developing momentum was undermined by the uncertainty regarding potential UK budget policy announcements in the second half, highlighting the cautious sentiment that remains in our sector. Despite this, the Group held market share and we were pleased to see an improvement in our despatch volumes broadly in line with the wider sector. We continue to focus on the provision of a broad range of premium brick and pre-fabricated products and believe this is the right strategy to address our competitive end markets both domestically and through imported products.

"Adhering to our capital allocation strategy has remained our core focus with significant investment made into our facilities to improve production efficiency, delivering our integration plans for our pre-fabricated operations moving onto our freehold sites, balanced with returning value to our shareholders through buybacks and dividends. We believe our strategic investments will deliver value for the Group as we look into 2026. Last year, we saw a longer shutdown at Carlton and the impact of relocating our pre-fabricated operations away from Watlington, which combined to negatively impact our FY25 profit metrics.

"We enter the new financial year with continued uncertainty around momentum in the wider UK construction industry and Belgium brick markets. Consumers remain cautious with affordability considerations and interest rate levels affecting their confidence to move or improve their homes and as a result the expected timeline for a market recovery continues to be uncertain. Notwithstanding this, we believe we have the right strategy, with a strong balance sheet, and with the investments in our facilities and operations during the year, we are well positioned for continued progression in 2026.

Separately, we would like to thank Rachel for her contribution to the Company and wish her well for the future."

^* The Directors believe that adjusted measures provide a more useful comparison of business trends and performance. Adjusted results exclude exceptional items, costs associated with acquisitions and aborted corporate transactions, and the amortisation of acquired intangibles. The term adjusted is not defined under IFRS and may not be comparable with similarly titled measures used by other companies. Adjusted performance results are reconciled with these reported results in the Chief Executive Officer's Statement below.

¹ EBITDA is defined as earnings before interest, tax, depreciation and amortisation.

An analyst briefing will be held virtually at 09:30am today. To attend, please email [email protected].

The Company also notes that it will be hosting an online presentation to retail investors today at 04:00pm. Those wishing to join the presentation are requested to register via the following link: https://engageinvestor.news/MBH_IP2026

About Michelmersh Brick Holdings PLC:

Michelmersh Brick Holdings PLC is a business with six market leading brands: Blockleys, Carlton, FabSpeed, Freshfield Lane, Michelmersh and Floren.be. These divisions operate within a fully integrated business, combining the production of premium, precision-made bricks, pavers, special shaped bricks and prefabricated brick components. The Group also includes a landfill operator, New Acres Limited, and seeks to develop future landfill and development opportunities on ancillary land assets.

Established in 1997, the Company has grown through acquisition and organic growth into a profitable and asset rich business, producing over 120 million clay bricks and pavers per annum. Michelmersh currently owns most of the UK's premium manufacturing brick brands and is a leading specification brick and clay paving manufacturer.

Michelmersh strives to be a well invested, long term, sustainable, environmentally responsible business. Opportunity, training and security for all employees, whilst meeting the needs of stakeholders are at the forefront of everything we do. We aim to lead the way in producing some of Britain's premium clay products and enhancing our environment by adding value to the architectural landscape for generations to come.

We are Michelmersh Brick Holdings PLC: we are "Britain's Brick Specialist".

Please visit the Group's websites at: www.mbhplc.co.uk, www.bimbricks.com and www.sustainablebrick.com   

Chief Executive Officer's Statement

Navigating market uncertainty while investing for long‑term growth

The Group's 2025 results have been delivered in what remained a very challenging environment across the construction industry both in the UK and in Belgium. The caution and uncertainty inherent in consumers, which is weighing on any consistent recovery in our end markets, continues to be impacted by the overall economic environment. The catalysts for supporting any significant improvements in market conditions remain uncertain, with no new Help to Buy initiatives to alleviate affordability concerns and the cautious pace of further reductions in interest rates, driven by persistent inflation, which have in combination undermined consumer confidence and impacted demand for our brick and pre-fabricated product portfolio. The year also saw historically low planning approvals, particularly in London and the South East, with the specific impact from the Building Safety Act and the Gateway 2 and 3 regulations, significantly impacting the recovery momentum in some of our key markets, most noticeably in the architects, specifiers and developer space. Given the trading backdrop the Group focused on delivering on our strategic initiatives during the year with a significant capital investment programme focused on site efficiency and integration activities whilst continuing to manufacture high quality products and delivering a positive customer experience. As ever, the Board is hugely grateful for the work and dedication of all our people across the Group in delivering a full programme of change management across our sites which we expect to deliver benefits for the Group from the start of our new financial year.

The lack of any consistent positive momentum in the construction sector has remained the key trading environment characteristic for the Group since June 2023 and the calendar brick despatch peak, in both the UK and Belgium, of our 2022 financial year. Despite this long downturn, we still believe that the fundamentals in our end markets in the UK and Belgium remain positive. All of the market data points inform our thinking that there is a critical shortage of both new residential and social housing, a significant legacy housing inventory constructed with brick facades underpinning future Repairs, Maintenance and Improvement ("RMI") demand, and requirements for specification and brick-cladding remedial solutions. In the UK, whilst the Government targets and messaging have evolved over the last 18 months, informed by our own interactions as well, we believe they remain committed to improving the volume of housing formations before the Government exit this current parliament in 2029. Likewise, in Belgium, the Government is targeting 70,000 new homes a year to reverse their critical housing shortages, of which currently they remain about 40% below this key metric. As a result, our strategic approach remains unchanged by focusing on targeting our broad product portfolio to address a balanced demand across each of these market segments. In our view this underpins the resilience of our business as we focus on delivering returns for shareholders. We have always recognised the importance of our relationships with our customers and we believe that these deep associations support our business strategy. Maintaining these key partnerships through the delivery of excellent products and services remains central to our resilience.

Our fundamental core competency remains our significant strength in the premium end of the brick market in the UK and Belgium. We view the long-term fundamentals of these markets as positive, with brick continuing to be the façade material of choice due to its longevity, sustainable and energy efficiency qualities, low-cost base and broad aesthetic appeal. Demand for bricks remains c. 20% below the 2022 high point with the ongoing caution from consumers continuing the long trough in activity levels. UK brick production capacity has been gradually increased over the last twelve months in anticipation of improving end markets and customer demand volumes. As a result, brick production has been running ahead of despatch volumes throughout the year and consequently inventory volumes for the sector are over the five year average at c. 550 million. These market dynamics made pricing highly competitive throughout the year and we will continue to watch with caution as we move into the new year to see if the imbalance in supply and demand continues given the fluctuating market conditions.

Broader portfolio bringing enhanced routes to market

We have been operating with a broader portfolio of clay bricks and clay pre-fabricated products for the last three years and we firmly believe in the strategic importance of off-site pre-fabricated manufacturing for the construction industry. The expanded product offering of pre-fabrication has brought us enhanced routes to market with a complementary customer base and distribution channels. Equally, the decline in construction activity, which we articulate through brick despatch volumes, has also brought challenges within our pre-fabricated operations. As a result, we took the decision to accelerate our integration plans for pre-fabrication with the decision to close our leasehold site in Watlington with the relocation of all operations split equally, south to Michelmersh, and north to Charnwood. We are delighted that we have been able to repurpose vacant factory space at Michelmersh to establish chimney and arch pre-fabrication on the site and this is working very well alongside our continuing brick operations. The site renovation work was completed in the summer and we are delighted with the quality of the production operation and are very grateful to our people onsite. Charnwood was already operating prefabricated operations in part of the facility so the relocation supported the expansion of existing operations. Given the expansion at Charnwood for pre-fabrication and following a period of strategic review for our bespoke Hathern Terra Cotta range, we took the difficult decision to cease operating the brand and to exit the market for this niche high quality product range. Unfortunately, the level of commercial demand for the terra cotta portfolio over the medium and long-term did not support any decision to continue production operations but we are very grateful to the long and loyal service of the Hathern team over many years and they left the Group with our sincere gratitude.  

Continued delivery of capital allocation policy

The Group's continued ability to generate operational cash underpins our confidence to follow our capital allocation policy. This has enabled us to invest in the projects that address our strategic objectives to improve the sustainability of our manufacturing operations, support our integration plans for our pre-fabricated portfolio  and to support ongoing improvements in production efficiency. We remain committed to the importance of returns to shareholders through maintaining our attractive dividend ratio. The proposal of the final dividend of 3.00p per share for the year underlines our confidence in the outlook for the business. As we communicated at the start of April, we have also supplemented our dividends with our share buyback programme which completed in December with the original allocation of £2 million. The Board will continue this activity where it determines that it is appropriate to do so to deliver value for shareholders and represents an attractive investment opportunity for the Company. Balancing the returns for our shareholders through dividends and buybacks alongside ensuring we maintain well invested manufacturing sites are central to the Group's capital allocation priorities. This strategy leaves us well-positioned to deliver further progress and shareholder value as we move into our new financial year.

Board changes

Peter Sharp stood down from the Board as Chief Executive Officer in September but we are delighted that Peter is staying with the business in his new role as industry adviser to the Board. Peter had been on the Board since 2016 and during that period the Company enjoyed significant growth and success with the Group's annual brick output increasing from 70 million to over 120 million. The portfolio was also broadened to include brick fabricated products and the Company also entered the European market with Floren in 2019. Peter has worked within the Clay industry for over 40 years so his extensive experience will continue to be of great use to the Board and myself in his new position. Peter has been a highly valued colleague and member of the Board and from a personal perspective I have been very grateful for his support and advice over the last four years since I joined the Company.

We announced in September that Rachel Warren joined the Board as our new Chief Financial Officer from Wincanton, the former FTSE listed group. As announced today, Rachel has resigned as a Director due to personal reasons and will be leaving the business in May 2026. It was disappointing to make a change to our Executive Team so soon after Rachel joining. It is critical that we continue to challenge ourselves in making sure we have the right team in place to support the delivery of the Group's strategic priorities.

Allied to this and with our continuous focus on ensuring that the Board has the appropriate balance of skills and experience, we were therefore delighted to announce that Darren Waters joined the Board from the start of November as an Independent Non-Executive Director. Darren is a member of the audit and nomination committees and from the start of January 2026 he was appointed as Chair of the remuneration committee. Darren was the Chief Executive Officer of Eurocell plc, the leading UK manufacturer and distributor of door and window products to the trade. He was also formally the Chief Operating Officer in the executive team at Ibstock plc, the building products business, where he was responsible for sales and operations across the clay and concrete business. Prior to Ibstock, Darren was CEO of Tyman Plc (UK and Ireland), the building products manufacturer. Darren has significant industry experience as a strategic leader in the building products sector which, alongside his operational expertise focusing on ESG, health and safety, culture and sustainable operations, will greatly assist the Group.

Following these Board changes during the year and post year end, we believe that we have a team that is well placed with the right capabilities to support the Group as we continue to deliver against our strategic objectives.   

Sustainability

Sustainability remains central to the Group's strategy which helps to inform our capital allocation priorities, our focus on operational performance and our longer-term strategic objectives. During the year, the Group continued to target reductions in our environmental footprint alongside a continuous focus on our governance frameworks through maintaining a clear focus on transparency, optimisation and the integrity of our ESG data. We have also continued to monitor our progress against our seventeen non-financial ESG key performance indicators disclosures which are aligned with the Group's commitment to achieve net zero by 2050.

During 2025, the Group undertook a Double Materiality Assessment to validate the alignment between our sustainability strategy, business priorities and ESG key performance indicators. This process provided assurance that the Group is prioritising the appropriate strategic objectives alongside looking to ensure that our sustainability objectives continue to be reflected within our ESG reporting and our Board decision-making.

As a manufacturing business, energy use and production efficiency represent a significant proportion of our environmental impact. Accordingly, we have continued to prioritise the quality, accuracy and independent assurance through our Scope 1 and Scope 2 emissions data. This has supported improved operational control and the identification of further production efficiency opportunities and importantly more broadly we believe that the Group remains on track to achieve our targeted reduction in energy intensity.

Underpinning our sustainability strategy this year has been a clear focus on a continuous improvement programme of our data management and reporting capabilities including the expanded use of real-time data capture and Power BI reporting across our operational footprint. We believe that through focusing on the quality and provision of our data management this will support improvements in site efficiency and support our capital allocation decision making across manufacturing, logistics and our support functions.

Product transparency remains a core component of the Group's sustainability approach. Continued progress towards the publication of Life Cycle Assessments and Environmental Product Declarations we believe will ultimately inform the decision-making for our customers.

Building on this strengthened data foundation, the Group completed its first Scope 3 greenhouse gas emissions calculation during 2025. While Scope 3 emissions represent a smaller proportion of the Group's overall footprint compared to many organisations, this work provides increased visibility across the value chain and supports a more complete and transparent understanding of environmental impacts.

Fundamentally, our sustainability strategy remains embedded in accelerating and defining a clear pipeline of major decarbonisation projects for implementation over the next decade.

Awards and recognition

We were once again delighted that our diverse portfolio of clay products was recognised in 2025 through our successes at the Brick Development Association ("BDA") industry awards. The 49^th BDA awards saw the Group win four awards and we excelled across the Refurbishment, Large Housing, Specialist Brickwork and Commercial categories. The results highlight how our products have been thoughtfully utilised in both contemporary architecture and the sensitive restoration of historic buildings.

We were very pleased to receive the Architects' Choice Award, which remains a prestigious category, given the importance of this market segment to the Group. The importance of these types of award is that fundamentally it provides a showcase of the Group's range of clay brick and clay pre-fabricated products which are the ideal choice for specifiers and architects.

Also among our awards was recognition for one of the Group's standout projects, Tileyard North in Wakefield, which was a project by Hawkins\Brown to transform the former Rutland Mills into one of the UK's largest creative hubs outside London. Through careful restoration the design celebrates the site's industrial heritage while introducing new spaces for collaboration and innovation. Blockleys Windermere Grey and Park Royal bricks were selected to complement the mill's original construction of historic brickwork, seamlessly blending the old and the new.

Further success came with Bulrush Court in London by Pitman Tozer Architects using Floren Avorio in a large redevelopment as part of a 950 home development scheme. This phase of the project included provision for 144 affordable homes in a mid-rise mansion block together with public areas and commercial spaces. Built with the community as its focus, the project was conceived as a city block but with a people centric approach.

We were delighted to be among the projects selected by Swift Brickwork Contractors as part of their submission for the Specialist Brickwork Contractor Award. The company showcases innovation and sustainability and their ideologies as a business align perfectly with our Group, as well as their health and safety initiatives and approach to training being industry benchmarks within the clay sector. The Bishops Stortford High School used Freshfield Lanes Lindfield Yellow and Selected Dark bricks to create a unique and contrasting façade between warm yellow bricks and elements of metalwork and window trim.

The recognition reflects the dedication of our talented employees, the skill of the architects and contractors we collaborate with, and the enduring quality of our materials. These awards reaffirm our commitment to producing sustainable, high-quality clay products that enrich the built environment and demonstrate the beauty and diversity of the Group's brickmaking.

Charity

We continue to believe in the importance of our charitable commitments and 2025 represented another year in which we increased our charitable giving to both local and national charities. Our people remain very engaged in how we allocate our charitable support and we were very pleased with the response from our colleagues at the beginning of the year with a total of fifteen different charities receiving nominations for support this year. Following a review, we selected the Lighthouse Construction and Band of Builders charities as our two principal charities for the year with increased support not just in monetary terms but in also through raising awareness for their charities through social media and other platforms. Alongside the support for our two principal charities we also allocated monetary donations to the other nominated charities in recognition of the important work that they all undertake in their annual activities.

Both the Lighthouse Construction and Band of Builders charities are focused on the provision of support for construction workers in the areas around mental health and we are acutely aware of the specific challenge our industry faces in this area. As a business we take the issue of mental health very seriously, not just for our colleagues, but also within the broader sector by looking to support those charities who are doing incredible work through their support for the construction sector specifically.

Again throughout 2025, in addition to the annual staff nominations, we also supported numerous community events local to our manufacturing facilities as well as donating to individual staff charity fundraisers throughout the year.

Supporting education

Supporting education and skills development remains a core element of the Group's social strategy. During the year the Group donated 110,000 bricks in support of vocational training and community initiatives across the UK under our ongoing Pledge 100 initiative.

Alongside the product donations, we also provided further education colleges with materials to support bricklaying and construction training programmes which enabled over 1,200 students to develop practical, industry-relevant skills using high-quality products. This continued investment reflects the Group's long-standing commitment to addressing the well-documented skills shortage within the construction sector and supporting the next generation to enter our industry.

In addition to the more formalised educational support, the Group also provided products to support local families and community-led youth clubs and groups, helping to deliver practical improvements where financial resources are often more constrained. These donations focused on initiatives that provide safe, constructive environments for young people and support communities located close to our manufacturing locations.

Through our ongoing commitment to education, skills development and community support, the Group continues to deliver meaningful social value while strengthening long-term resilience within the construction sector's broader community.

Group Results

Financial Highlights

^*The Directors believe that adjusted measures provide a more useful comparison of business trends and performance. Adjusted results exclude exceptional items, costs associated with acquisitions and aborted corporate transactions, and the amortisation of acquired intangibles. The term adjusted is not defined under IFRS and may not be comparable with similarly titled measures used by other companies. Adjusted performance results are reconciled with these reported results in the Chief Executive Officer's Statement below.

¹ EBITDA is defined as earnings before interest, tax, depreciation and amortisation.

The lack of momentum and consistent demand within the construction market, the timing of our capital improvement works, and our continued programme of phased integration of our pre-fabrication business have combined to affect the trading performance in the business in 2025, with the Group being impacted across all of our profit metrics.  

Revenue for the year declined by 1.7% to £68.9 million over the equivalent year in 2024 (2024: £70.1 million) which was largely as a result of specific trading challenges within our Floren and FabSpeed brands, with our brick UK performance showing an improvement year on year. Taking the UK first, this performance over the year included low single digit increases in our despatches. At the same time, consistent with our approach to pricing for the last two years, we continued to maintain stable portfolio pricing to support diversity in our forward order book and this approach contributed to stable average selling prices despite, what was, and remains a very competitive pricing environment. On the continent, our Floren brand was significantly impacted by the domestic macro market which was very challenging throughout the year. The Belgium building permits granted in 2025 declined again during the year and the broader market remains over a third below the levels from 2022. Since our acquisition of the site, Floren products have been well recognised by architects and specifiers, particularly in London and the South East, but unfortunately these established markets were equally challenged by changes in planning. As a result, our Floren despatches and revenue were significantly impacted with an approximate 20% decline in both metrics. Given the dynamics of Floren's end markets we temporarily stopped production twice during the year in Q1 and Q3 which facilitated planned and brought forward capital improvement works. As with our other production pauses in the Group at Carlton and Michelmersh at the start of the year, we prioritised our inventory planning and manufacturing scheduling to try to ensure there was minimal impact on the planned despatches across our Floren customer base in both the UK and on the Continent.  

The overall construction environment remains very challenging which we measure through the sector wide UK brick despatches which are still some 20% below their last peak in 2022. However, as we highlighted last year, we have not seen this level of decline across the Group and we remain very focused on maintaining our market share in this current environment. We see maintaining our market position in our key end channels as an important indicator reflecting the overall resilience of our business model. Our order intake volumes remain a very important barometer for us and whilst we continue to see intake ahead of normalised capacity it is important to highlight that it is harder to predict the timing of call-offs than it has been previously. We know that our customers remain enthusiastic about our portfolio and this reflects the benefits of our product portfolio's broad reach and the strong customer loyalty and distributor relationships we have across our end markets. Whilst our order intake and order book remain very important to us, the visibility and certainty that this has traditionally provided has been somewhat diluted by the consistency of call-offs. As a result, we start 2026 remaining watchful of our production volumes in the UK and Floren and remain ready for the potential for further facility downtime in the short-term. 

Due to the timing of our capital improvement activities, the interruption caused to production through the relocation and closure of our Watlington leasehold site, and more broadly the market challenges in the UK and in Europe, our profit metrics were negatively impacted in the year. Adjusted operating profit of £8.4 million was down 16.8% on the comparative 2024 year (2024: £10.1 million) and adjusted profit before tax of £8.1 million was down 18.2% (2024: £9.9 million). The extended shutdown at Carlton by two-weeks and the subsequent commissioning period, combined to reduce our manufacturing volumes by three million units in the year at this key site, and this one-off impact was not recovered in the second half as expected, which was a significant drag on profits.

We continue to manage our input costs on a risk-based approach and as such, we have secured over 75% of our energy requirements for 2026. As with 2025 we see this as an appropriate hedged balance as we continue to see some opportunity in the potential for improvements in the pricing of utilities supported by the contracts we have secured beyond 2026. As such, energy contracts are also in place for broadly 50% of our expected requirements in 2027 with further contracts into 2028 in line with this approach. Despite the one-off challenge with Carlton in the first half of FY25 the Group's strategy remains focused on managing our operational efficiency to maximise our financial returns, whilst importantly maintaining a close relationship with our loyal customers through our ability to deliver a greater degree of pricing visibility. 

Adjusted EBITDA of £12.4 million was 11.4% lower than 2024 (2024: £14.0 million). This lower margin of 18.0% compared to our 2024 exit margin of 20.0% largely reflecting the impact of our Carlton production delays, the challenging trading at Floren and the interruption in production for our pre-fabricated operations.

On a reported basis, the results include the impact of the amortisation of acquired intangibles and some exceptional one-off items incurred over the year which we believe are more helpful to exclude from those costs which relate to ongoing operational performance. The adjustment of £1.4 million for the amortisation of intangibles is in line with 2024. Separately, during the year we have incurred exceptional items of £2.4 million. These relate to £1.4m of costs incurred due to the closure of our Watlington operation including all wind-down operating costs, redundancy costs, dilapidation and decommissioning and non-repeating site overheads. £0.4m of one-off costs are associated with the closure of our Hathern Terra Cotta brand and the remainder all related to other Group restructuring costs. As a result, operating profit of £4.7 million was 42.7% below 2024 with profit before tax reflecting the same performance also down 46.3% at £4.3 million.

After a tax charge of £0.7 million (2024: £1.9 million), the Group recorded a profit for the year after tax of £3.6 million (2024: £6.1 million). The tax rate of 15.9% (2024: 24.5%) is lower than our normalised tax rate of 25.0% due to some prior year tax credits. 

Adjusted basic earnings per share decreased by 8.3% to 7.50p (2024: 8.18p).

Basic earnings per share decreased by 39.0% to 4.02p (2024: 6.59p) reflective of the drop through of our revenue reductions and cost increases during the year.

The table below (Adjusted Performance Measures) provides a clear reconciliation of the adjusted performance to the reported numbers.

Adjusted performance measures:

^a The calculation of adjusted basic earnings per share is based on the adjusted profit before tax of £8,087,000, which excludes amortisation of acquired intangibles and exceptional items, then deducting taxation at the effective group rate of 15.9%, and the weighted average number of ordinary shares in issue, below in note 3.

Group Cash and Working Capital

Cash generated from operations for the year was £10.9 million, compared to £10.2 million in the prior year. Operating cash conversion from adjusted EBITDA was 87.9%, ahead of our like for like comparison in 2024 of 72.9%, which is more in line with our typical rhythm of +90%. This was largely the result of the tight management of our working capital cycle and broadly matching our production output to our expected despatch volumes as we carefully monitored our inventory position as we targeted investing in the right inventory mix. As we highlighted in September, we run ahead of our normalised run rate for capital expenditure for the year given the scale of works we have undertaken over the last 12 months particularly and we still expect the investment profile to normalise in our 2026 financial year. 

We believe in the quality of our underlying fundamental cash-generating ability in the business and we expect operating cash conversion to hold at these normalised levels as we look into the new year and this continues to underpin the approach to our capital allocation priorities for the Group. 

At the year end the Group had net debt of £0.7 million (2024: net cash of £6.0 million).

Our operating cash generation, small net debt position and £20 million Sterling and Euro denominated bank facility provides the Group with considerable financial resilience and flexibility to pursue our capital allocation policy. We renewed our bank facility in August and as a reminder this is committed until August 2028 with a further two 1-year extension options.

Property, plant and equipment

Our capital expenditure in the year highlights our continued focus on proactively maintaining well invested and efficient manufacturing facilities. The principal expenditure over the year was focused on Carlton, Floren and Michelmersh with the ongoing works carried over from 2024 continuing as the three facilities were closed from the start of 2025 with Floren temporarily stopping production again in Q3 and the integration work at Michelmersh occurring over the summer. Taking each site in turn, Carlton was offline for all of January facilitating the completion of works started in November 2024. The works took two weeks longer than we originally planned given the unfortunate delay on the manufacture of a key element of tooling. Michelmersh was closed for all of January and February as we undertook and completed major kiln refurbishment works and key equipment upgrades. Floren remained closed to the end of February as we concluded the major upgrades to improve the environmental efficiency of our manufacturing processes through the installation of a new exhaust scrubber system. The changes to the Floren exhaust system also facilitated changes in our input materials mix to importantly extend the life of our mineral reserves significantly which we successfully trialled in March with very satisfactory results. We paused production at Floren again in Q3 to bring forward some planned roof improvement work over the main factory alongside significant improvements to the brick yard.

We also took the decision to accelerate our planned integration of our FabSpeed brand where we completed the installation of a new facility at our Michelmersh site as well as expanding the scale of our operations at Charnwood which allowed us to relocate our existing Watlington operations. With the relocation work completing over the summer, we are grateful to the staff at Watlington who remained with us after cessation of production operations to undertake the extensive decommissioning work ahead of the successful handover to the landlord at the end of December.  

Purchase of own shares

In April 2025 we announced the renewal of our share buyback programme which we first launched in November 2022 to reduce the share capital of the Group and to return value to shareholders. The scheme continued to run until the end of December at which point we had fulfilled the original allocated consideration of £2.0 million purchasing an additional 2,132,427 shares, taking the total shares purchased to date to 4,357,427. The shares continue to be held as treasury shares.  

Dividend

The Board is pleased to continue to commit to a dividend policy reflecting a balanced approach to generating and returning value to our shareholders, and as such, the Board is recommending a final dividend of 3.00 pence per share (2024: 3.00 pence per share), which, together with the 1.60 pence per share interim dividend (2024: 1.60 pence per share), gives a total dividend of 4.60 pence per share (2024: 4.60 pence per share), in line with last year. The proposed dividend will be paid on 8 July 2026 to members on the register on 5 June 2026 with shares being marked ex-div on 4 June 2026.   

Outlook

The prolonged downturn in construction activity in the UK and northern Europe continues to test our strategy and the robustness of our business model. In our principal regions, our key measure of the demand dynamics is the volume of brick despatches, and these are still over 20% below the most recent high of 2022. Our response to these very challenging market dynamics has been consistent through focusing on our core competencies by continuing to invest in well-maintained and efficient operations that manufacture the highest quality premium brick products for our customers. We believe that our business has remained resilient over the last three years of difficult trading and this has largely been achieved through the quality of our people and our ability to address a broad range of end markets, which we view as essential as we look to make further strategic progress into 2026.

The confidence and predictability that we have historically drawn from our order intake levels has moderated over the last 12 months which stems from the weaker consumer confidence and the inability of our customers to be as clear on project commencement dates and delivery scheduling. Notwithstanding this, order intake remains an integral component in how we measure the enthusiasm of our customers for our product portfolio. This has run ahead of our manufacturing capacity throughout 2025 and has continued into the start our new financial year. This order intake momentum is positive despite the recovery in construction activity levels remaining uncertain. The fluctuations in sector demand mean that we remain watchful of continued overcapacity in our brick markets however our strong balance sheet allows us to plan our production scheduling and inventory management and we will respond to the changing market conditions accordingly. Commercially we are focused on staying close to our customers and continuing to diversify across RMI, housing, commercial, social and specification projects and this whole market strategy continues to underpin our outlook.

Consumers continue to exercise caution in their decision making to move or improve their homes but given our facilities and portfolio we remain well placed at the premium end of the brick market in the UK and Benelux markets. The UK Government continues to highlight its commitment to improving the planning process alongside increasing the volume of new homes being delivered to the market and they are clear that a positive construction sector will support broader growth targets in the UK. These Government statements indicate that the medium-term fundamentals of our markets have a more positive horizon and alongside the inherent characteristics of our portfolio are hugely supportive with brick continuing to be the façade material of choice due to its longevity, sustainability and energy efficient qualities in use, low cost and broad aesthetic appeal. We believe the investment in our facilities throughout 2025, and the accelerated integration of our pre-fabricated operations, contributes to us being better positioned operationally in our current challenging markets but ultimately will help us benefit when we have positive and consistent momentum from our customer base.

Active risk management of our cost base and the execution of integration activities has supported our ability to maintain stable product pricing and given the strength of competition in our markets we believe this approach will support us in maintaining our market share and continue to generate order intake momentum from a diverse and loyal customer base with demand from specification, housing, RMI and commercial sectors.

We remain resolutely focused on delivering sustainable operational cash generation, which has underpinned our liquidity position at the start of the new year. Combining this with our £20 million borrowing facility provides the Group with both considerable financial resilience and flexibility to pursue our clear capital allocation framework as we focus on delivering further value for our shareholders.

The medium term fundamental market drivers for our business are encouraging and we continue to be well positioned, however there are ongoing challenges in our sector stemming from a lack of confidence in consumers due principally to affordability concerns. Despite this, we believe we have an attractive portfolio of products which is in demand across the full breadth of our end markets and it is these indicative fundamentals that underpin our view that we remain resilient as a business and will continue to look to make progress against our strategic initiatives into 2026 and beyond.

Ryan Mahoney

Chief Executive Officer

Consolidated Income Statement

for the years ended 31 December 2025 and 2024

.

Consolidated Statement of Comprehensive Income

for the years ended 31 December 2025 and 2024

Consolidated Balance Sheet

as at 31 December 2025 and 2024

Consolidated Statement of Changes in Equity

for the years ended 31 December 2025 and 2024

Consolidated Statement of Cash Flows

for the years ended 31 December 2025 and 2024

*The aborted transaction costs for December 2024 have been reclassified from financing activities to operating activities on the basis of where they were classified in the income statement. This has resulted in the net cash used in financing activities and the net cash (used in)/generated by operating activities changing.

NOTES TO GROUP PRELIMINARY STATEMENT

1.     Accounting Policies

The consolidated financial statements have been prepared in accordance with UK-adopted international accounting standards and with those parts of the Companies Act 2006 applicable to companies reporting under accounting standards as adopted for use in the UK.

The consolidated financial statements are presented in sterling and all values are rounded to the nearest thousand ("£000") except where otherwise indicated.

2.     Financial Information

The financial information set out in this Preliminary Announcement does not constitute the Group's statutory financial statements for the years ended 31 December 2025 or 2024. The financial information has been extracted from the Group's statutory financial statements for the years ended 31 December 2025 and 2024. The auditors have reported on those financial statements; their report was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006.

The statutory accounts for the year ended 31 December 2025 will be filed with the Registrar of Companies following the Company's Annual General Meeting. The statutory accounts for the year ended 31 December 2024 have been filed with the Registrar of Companies. The report of the auditors on those statutory accounts was also unqualified, and also did not contain a statement under section 498(2) or (3) of the Act.

3.     Earnings Per Share

Basic  

The calculation of earnings per share from continuing operations based upon the profit for the year of £3,650,000 (2024: £6,104,000) and 90,659,952 (2024: 92,601,027) weighted average number of ordinary shares.

Diluted                       

The calculation of diluted earnings per share from continuing operations based upon the profit for the year of £3,650,000 (2024: £6,104,000) and 92,542,587 (2024: 95,547,490) weighted average number of ordinary shares.

4.     Dividend

The Board has recommended a final dividend for the year of 3.00 pence per share, to be paid on 8 July 2026 to shareholders whose names appear of the register of members at the close of business on 5 June 2026. 

5.     Annual Report and Accounts

Copies of this announcement are available and the Annual Report will be available in due course on the Group's website www.mbhplc.co.uk and from the Company's registered office at Freshfield Lane, Danehill, Haywards Heath, West Sussex RH17 7HH.