Co Tyrone manufacturer AG Paving and Building Products (AG) has cut its annual losses by more than £1 million, as operational improvements helped it navigate another difficult year for the construction industry.

The multi-site business, which employs just over 200 people across the UK and Ireland, posted a pre-tax loss of £513,634 for the year to 31 December 2025, according to newly filed accounts at Companies House.

Although still loss-making, the outcome represents a year-on-year improvement of more than £1.16 million. Turnover also increased, rising from £27.8 million to £28.7 million.

AG said the stronger performance followed a broader programme of financial and operational measures, including the repayment of £19.5 million of bank loans under a 10-year debt reduction plan set out in its 2024 accounts.

The directors described 2025 as a year of "clear operational and financial progress", with actions taken during the period lifting margins and efficiency.

They reported that gross margins benefited from tighter commercial discipline, a stronger product mix and greater operational efficiency. The gains were achieved despite continued pressures across construction; while inflation eased, AG still faced higher wage costs and increased prices for raw materials, energy and other inputs.

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Headcount edged down from 218 to 207 over the year, but staff costs rose as the company continued to invest in pay, training and skills development.

The directors said attracting, retaining and developing skilled employees remains central to the long-term success of the business.

AG added that it is managing cost pressures through frequent margin reviews, disciplined pricing and an emphasis on quality, customer service and product differentiation rather than competing purely on price.

On sustainability, the company reaffirmed its target to reduce Scope 1 and Scope 2 carbon emissions by 30% by 2030 under the Climate Action Pledge, and achieved Platinum status in the Northern Ireland Environmental Benchmarking Survey for the third consecutive year.

Looking ahead, the directors said AG is entering 2026 with a strong order book and a solid pipeline of opportunities across the UK and Ireland.

Since the start of the year, AG has supplied facing brick for Belfast's Loft Lines development in the Titanic Quarter and paving products for Queen's University Belfast's Advanced Manufacturing Innovation Centre (AMIC) in Newtownabbey.

While acknowledging ongoing economic uncertainty, the directors said the improvements delivered over the past year, coupled with tighter cost control, have strengthened the company's position.

AG plans to continue selective investment in innovation, operational efficiency and its workforce as it works towards a return to sustainable profitability.

Alongside its main manufacturing hub in Fivemiletown, AG operates sites in Toome, Pomeroy and Carryduff, supplying paving, walling and facing brick to commercial and residential markets via builders' merchants and direct channels.