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Forterra delays £27m renovation of Staffordshire brick factory

Written by on 25/05/2022



One of the UK’s biggest brick makers has delayed the £27 million refurbishment of its Staffordshire factory in response to global supply chain issues.

Forterra announced the multi-million pound investment last year as part of a move to improve ‘efficiency and sustainability’ at its Wilnecote factory, near Tamworth.

In a recent trading update, the Northampton-based company – which employs about 1,800 people across 18 manufacturing sites – revealed that it is putting off its renovation plans for three months due to the limited availability of semi-conductors and chips used in robotic equipment.

It means the Wilnecote factory is now expected to close for three months from the end of September 2022, instead of June 2022.

Elsewhere, the construction of its new £95 million Desford brick factory in Leicestershire – which will be the biggest in Europe – remains on track to open by the end of the year.

At the same time, Stephen Harrison has announced he is stepping down from his role as chief executive officer. Mr Harrison will remain with the company until the first half of next year allowing time to commission the new Desford factory and support an orderly transition.

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The trading update said: “Construction of the new £95 million Desford brick factory, which will contribute to earnings from 2023 and is expected to increase annual EBITDA by £25 million by 2025, continues to progress in line with our timetable and budget, with commissioning expected by the end of the year.

“In order to de-risk the £27 million Wilnecote brick factory refurbishment project, in response to the global supply chain issues limiting the availability of semi-conductors and chips used in the robotic equipment, we have delayed the commencement of the project and temporary closure of the factory by three months. The factory is now expected to close at the end of September 2022 rather than at the end of June 2022, with the duration of the project remaining unchanged and the factory due to close for a 12-month period. This rescheduling will have a positive impact of around £1.5 million on the 2022 result.

“We continue to progress our pipeline of attractive organic growth projects beyond those already announced and have recently invested £1.8 million in securing 4.5 million tonnes of clay reserves at our Swillington site where we retain the optionality to construct a new brick factory in the future.”

For the four months to April 30, 2022, revenue at Forterra was 25 per cent ahead of 2021 and 18 per cent ahead of 2019. The company says the rescheduling of the Wilnecote project will help ensure the its full-year result is “materially ahead” of its previous expectations.



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