Business Irish

Wednesday 22 February 2017

Second-half outlay for 2011 brings spend by CRH to €600m

Published 05/01/2012 | 05:00

CRH chief executive Myles Lee: 'strategy to add value'
CRH chief executive Myles Lee: 'strategy to add value'

CRH spent €407m on acquisitions in the second half of 2011, bringing its spend for the year to almost €600m.

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But the figure lagged behind the group's recent historic run rate, amid caution over the economic outlook in the US and Europe. Shares closed down 1.3pc at €15.48.

CRH made 23 acquisitions and investments in the second half of the year, with the spend broadly evenly split between North America and Europe.

Its Europe Materials division forked out €195m on three acquisitions and one investment.

The acquisitions included a cement factory in Ukraine, where it bought a 51pc stake in Odessa Cement in Odessa city. Bolt on purchases in Finland comprised three concrete plants in the west of the country.

CRH's associate in China, Yatai Building Materials, completed the construction of a 1.5-million-tonnes-per-annum cement mill. CRH owns 26pc of the company.

CRH's Americas Materials unit spent a total of €112m in the second half on nine acquisitions and adding approximately 250 million tonnes of aggregates to its reserves. The total investment by the division for the year was roughly €300m.

The purchases will boost CRH's annual sales by about $164m. Elsewhere in the US, CRH bought West Virginia-based Central Supply, a company that operates six readymixed concrete plants, a concrete block plant and five building supplies stores.

CRH also acquired businesses in Ohio, Kansas, Oklahoma and Texas. It also bought Pacific Source, a company with four distribution outlets in Hawaii.

CRH chief executive Myles Lee said the acquisitions were in keeping with group strategy to buy businesses that add value to existing operations.

Bloxham Stockbrokers noted that while the spend in 2011 was ahead of the €450m in 2010, it was still significantly lower than the €1bn spent by the group in 2008 and the record €2.2bn it spent in 2007.

Bloxham said the latest full-year figure served to underline CRH's continued caution in undertaking a "significant step" in acquisition activity for the time being in light of a demand backdrop that "remains challenging across developed markets".

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