The acquisition of Black Country brick producer Baggeridge has helped parent Wienerberger, the world's largest brick producer, offset the slump in demand caused by the decline in the US housing market.
Wienerberger, which acquired the Sedgley firm last year, said net profit slipped nine per cent year-on-year to £22.6 million in the first quarter due to higher costs in Western Europe.
However, it looks as though the initial boost will not be sustained. In a statement Wienerberger said it saw the UK and US markets becoming tougher.
"Wienerberger has revised forecasts for Britain because of more restrictive financing conditions for private households and declining property prices," said the statement. "The weakness in US residential construction is expected to have a negative effect on revenues and earnings in North America."
In Germany, it said moderate growth may be possible after the record low in single and two-family housing construction during the previous year and a slow start in 2008.
Going forward, Wienerberger said it would try and counter the "weak markets" with active capacity management and strong development in Central and Eastern Europe.
EBIT rose nine per cent in the first quarter to £34.4 million, beating expectations, driven by strong growth in Central and Eastern Europe and higher sales volumes in France, The Netherlands and the UK - due largely to Baggeridge business.
Revenues in the US fell 28 per cent to £42.5 million, while EBITDA slumped 90 per cent to £565,000.
Overall first-quarter EBITDA grew 10 per cent on the same period a year before to £74.4 million thanks to strong contributions from central and eastern Europe.
"In spite of this weaker market environment, we have again set a goal to generate an above-average increase in EBITDA compared with the building materials industry in 2008," said chief executive Wolfgang Reithofer.