...and our brickmaker tip is building up its value

BRICKS are in short supply in the UK. We use 2.6 billion a year and make 2.1 billion, importing the rest. Not all bricks are created equal however. Michelmersh Brick specialises in premium products, which look better, last longer and cost more than the rest.

They are in demand too. Architects, housebuilders, developers and homeowners are looking for bricks that are both attractive and resilient. They are prepared to pay up and keen for homegrown goods.

As a result, Michelmersh Bricks has delivered impressive growth since Midas recommended the company in early 2015. Then the stock was trading at 71p and the company was about to report profits of £2.8million for 2014. Last week, Michelmersh unveiled an 18 per cent rise in first-half profits to £5.2 million and said fullyear results would be above expectations.

Brokers now believe the group will produce 2019 profits of £9.2million, rising steadily in 2020 and beyond.

Management confidence is reflected in the dividend, which was just 0.5p for 2014 and is forecast at 3.45p this year. The strong results have propelled the Michelmersh share price 34 per cent higher since 2015 to 95p today and brokers believe there is further to go.

The firm has been behind a string of award-winning and highly regarded projects, from University College Hospital to the Conservatoire of Music at Birmingham University.

Most of Michelmersh business is focused on residential property, however, helping to build new homes and repair existing ones.

Demand is high on both fronts and likely to remain so, as political parties of every persuasion say they are keen to address Britain’s housing crisis. Michelmersh recently bought a business in Belgium too, which will create further opportunities in Northern Europe. Traded on: AIM Ticker: MBH Contact: mbhplc.co.uk or 0844 931 0022