Early signs of stronger housebuilding volumes will not immediately result in higher sales of building materials products, Ibstock has cautioned.  

The brickmaker noted ‘some initial indications of an improvement’ in new-build residential levels during the three months ending September.

Mortgage and inflation rates in Britain have normalised over recent months, spurring hope among the construction industry of trade rebounding.

Good signs: Ibstock noted ‘some initial indications of an improvement’ in new-build residential levels during the three months ending September

However, Ibstock warned that it would ‘take time to feed through into sustainably stronger demand for our products’ due to the need to revitalise supply chains.

The Leicestershire-based company made the announcement as it revealed adjusted earnings before nasties were ‘broadly in line’ with forecasts during the third quarter.

It also said sales volumes were commensurate with the equivalent period last year, while margins were supported by good management of costs and sale prices.

Consequently, the FTSE 250 group has upheld the annual guidance it provided when publishing its half-year results in August.

Joe Hudson, chief executive of Ibstock, said: ‘We have seen some initial signs of recovering activity levels in new-build residential markets, which should feed into sustainably stronger demand for our products in due course.

‘Against this backdrop, we have made some carefully targeted investments to restore capacity for product lines in some areas of our core markets.’

Ibstock is ramping up production at its new Atlas clay brick factory, which it expects to produce 105 million bricks per year once operating at complete capacity.

In addition, it anticipates that the Nostell site near Wakefield, Yorkshire, will deliver about 50 million brick slips into the market when fully operational.

During the general election campaign, the Labour Party vowed to build 1.5 million new properties over five years, partly by developing on lower-quality’ grey belt’ land and hiring more planning officers.

Only 183,610 new houses were constructed across the UK in the 12 months to March 2024, 13 per cent down on the previous year, according to recent Office for National Statistics figures.

Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: ‘The new government’s focus on reforming the national planning framework and speeding up the delivery of new housing is a huge positive for the industry.

But he added: ‘Just how long it takes for the housing market to really jump back into life is out of Ibstock’s control and remains to be seen.’

Ibstock shares were 0.5 per cent up at 193.4p on Thursday morning, taking their gains over the past year to 43 per cent.

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