CRH sees profit growth

CRH has reported that 2013 should represent the trough in its profits as the construction sector across the US and Eu continues to stabilise and improve.

CRH today stated that  revenue rose 2% in the second half of 2013 and noted a smaller decline in Europe boosted by a 5 % increase in the United States.

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Full-year earnings before interest, taxes, depreciation and amortisation (EBITDA) amounted to €1.48b, ahead of guidance given in November, the Dublin-based group said.

Albert Manifold, Chief Executive, said today:

“The review of our portfolio announced in November 2013 aims to re-set the Group for growth. While this has resulted in significant non-cash impairment charges, we believe that dynamic allocation and reallocation of resources to optimise the portfolio, together with our traditional tight cost control and capital discipline and our relentless focus on returns, will be key to driving growth and to rebuilding returns and margins over the coming years. We believe that 2013 represents the trough in our profits, and that 2014 will be a year of profit growth. We are encouraged by second- half activity levels in 2013 and by the fact that, while it is still early in the season, trading so far in 2014 has been ahead of last year.”

Financial Highlights

• Sales of €18 billion, in line with 2012; like-for-like sales down 2%
  6% decline in first half, followed by a 2% increase in the second half
• EBITDA of €1,475 million; ahead of November guidance
• Americas like-for-like sales up 2%; improving economic and construction trends
  Like-for-like sales down 1% in the weather-impacted first half; up 5% in the second half
  US Dollar EBITDA up 10%
• Europe like-for-like sales down 5%; signs of stabilisation as year progressed
  Like-for-like sales down 10% in first half; second half down 1%
  EBITDA for the year down 19%, also impacted by lower (-€29m) once-off gains
• Year-end net debt of €2.97 billion; better than November guidance
• Dividend per share maintained at 62.5c

Operational Highlights

• Continued focus on cost management; cost savings of €166 million delivered in 2012
• Initial phase of ongoing portfolio review now complete
• Business units not meeting returns criteria and identified for disposal account for 3% of 2013 EBITDA; non-cash impairment charges of €755 million (including €105 million in respect of JVs and associates)
• Cost savings of €195 million delivered, in line with November guidance