Thursday 22 August 2019

Shares in CRH jump as it expects full-year profits to be 25pc higher

CRH chief executive Albert Manifold
CRH chief executive Albert Manifold
John Mulligan

John Mulligan

Shares in Ireland's biggest company, CRH, soared over 5pc in Dublin yesterday after the building material group said it expects a 25pc jump in profits this year, beating analyst expectations.

CRH, whose chief executive is Albert Manifold, said it expects earnings before interest, tax, depreciation and amortisation (EBITDA) at its legacy business (which excludes newly acquired assets from Holcim and Lafarge) to be €1.97bn.

That's 5pc ahead of forecasts at Davy Stockbrokers.

Total EBITDA before transaction costs is expected to be around €2.3bn, which is in line with guidance given earlier this year.

CRH said that its third quarter trading had benefited from continued positive momentum in the Americas and that the backdrop in Europe continues to be mixed, but stable.

It added that cumulative sales at the group in the first nine months, excluding divestments and assets acquired from Lafarge and Holcim, totalled €15.5bn, a 16pc rise on the corresponding period in 2014.

In Europe, CRH said that results from continuing operations in the first half of this year "matched the strong first half of 2014". It expects EBITDA from European operations to be "marginally ahead" of the €664m they generated last year, assuming normal weather patterns.

Sales from continuing operations in the Americas - primarily the US - were up 7pc in the third quarter in dollar terms, while EBITDA climbed 30pc on the same basis.

For the full year, CRH expects EBITDA in the Americas to be 17pc higher on a constant currency basis. The region generated EBITDA of €977m for CRH last year.

This year, CRH agreed to pay €6.5bn for assets disposed of by Lafarge and Holcim as part of the merger of the French and Swiss companies.

The integration of those assets is being headed by Maeve Carton, who will move from her current finance director role at the group.

She formally takes up her new position of transformation director in January.

The acquisitions expanded CRH's footprint into new geographies such as the Philippines and gave it additional assets in a number of territories in which it already operates.

CRH said the integration of the new assets is "progressing well" and they are performing in line with expectations.

Irish Independent

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