CRH advances strongly in the Ukraine
CRH’s first half turnover improved by 5.2 per cent to €8,588m, but the EBITDA came off by 1.1 per cent to €568m. The better weather conditions in North America were offset by a worse experience in Europe. The trading profit was stable at €184m, while the pre-tax profit improved by 23.2 per cent to €117m, helped by gains on disposal, and the net attributable profit advanced by 36.8 per cent to €104m. Net debt at the end of June was 0.7 per cent lower at €3915m, to give gearing of 37.5 per cent, which compares with the 39.5 per cent shown a year ago. Capital expenditure in the period increased by 6.8 per cent to €314m and spending on acquisitions jumped by 55.4 per cent to €202m.
The European heavy building materials operations, which also covers the emerging operations in China, India and the Near East, saw turnover ease by 0.2 per cent to €1,334m, but the EBITDA did improve by 11.4 per cent to €66m. Much of the volume lost from the very cold weather in February was subsequently recovered, leaving underlying sales volumes just two per cent. An average price increase of two per cent did not quite cover the rise in costs. The Ukraine was the strongest performer with a 28 per cent increase in cement deliveries and the lower production costs from the new kiln. On the other hand, cement deliveries were off by two per cent in Poland and by five per cent in Finland and fell by 13 per cent in Switzerland. VVM in Belgium was a little disappointing in its initial first half. The Irish results were additionally hit by a seven-week strike. Downstream volumes were generally lower, notably in Spain as markets continued to deteriorate. The associates in Turkey and India improved results, in spite of a 6 per cent reduction in domestic deliveries in Turkey, while the Chinese operations experienced a sharp reduction in volumes of over a fifth.
Turnover in building products declined by 11.2 per cent to €1,251m and the EBITDA fell by 28.0 per cent to €90m from the combination of cold weather and weaker markets. With the exception of Denmark, volumes in concrete products were generally lower. A decline in British brick volumes was largely offset by higher average prices, while the Dutch and Polish demand continued to deteriorate, lower costs allowed some profit improvement. The construction accessories business experienced reduced profitability from lower volumes and margins. The European distribution turnover declined by 4.7 per cent to €1,984m and the EBITDA fell by 25.6 per cent to €96m as both the builder’s merchants and the DIY side saw reduced overall activity.
The North American heavy building materials turnover rose by 20.9 per cent to €1869m and the EBITDA advanced by 25.4 per cent to €74m and the first half trading loss was reduced by 8.2 per cent to €67m. Aggregates deliveries rose by 10 per cent, or by 8 per cent at the underlying level and average prices were 1 per cent higher. Asphalt volumes improved by 11 per cent and with a 5 per cent price increase, margins did improve. Ready-mixed concrete shipments advanced by 11 per cent, or an underlying 7 per cent, and selling prices recovered by 2 per cent. The building products turnover rose by 18.8 per cent to €1,435m and the EBITA advanced by 25.8 per cent to €122 and the trading profit jumped by 80.6 per cent to €65m. In distribution, turnover rose by 22.0 per cent to €715m and the EBITDA increased by one third to €20m and the trading profit by some 80 per cent to €9m.
