Breedon reports solid 1H23
Breedon Group plc announced its unaudited interim results for the first six months of 2023, ended 30 June.
Revenues for the UK-based construction materials group increased by 11 per cent YoY to GBP742.7m (US$958.7m), but EBIT saw a five per cent drop YoY to GBP62.1m in the 1H23. On a like-for-like basis (adjusting for six bolt-on acquisition in the last 12 months), revenue increased by seven per cent and EBIT by four percent. As as result the EBIT margin slipped by 140 basis points to 8.4 per cent.
Profit before tax declined by five per cent to GBP56.5m in the 1H23 when compared with GBP59.6m in the 1H22.
In terms of sales volumes, cement sales slipped to 1.1Mt in the 1H23 from 1.2Mt in the 1H22, while ready-mixed concrete volumes remained stable at 1.5Mm3. Aggregate sales fell to 13Mt in the 1H23 from 13.6Mt in the year-ago period. Asphalt sales declined to 1.8Mt in the 1H23 from 1.9Mt in the 1H22.
Breedon Group CEO, Rob Wood, commented: “In the first half our vertically-integrated and local operating model has again come to the fore, leveraging our long-term customer relationships and deep market knowledge. Our first class team has operated with great agility to deliver a strong start to 2023 for which I thank them sincerely and we are well-positioned for the second half of the year.
“The long-term structural dynamics driving infrastructure spending and housebuilding in GB and Ireland have not changed. To ensure we can efficiently and sustainably meet long-term demand for our essential construction materials, we have re-doubled our focus on those factors under our control; keeping our people safe and well while minimising the cost of production and maximising the value of the extensive portfolio of assets we own and acquire.
“By emphasising the operational factors we can influence, we will ensure we remain competitive and continue to deliver outstanding results. By challenging our procedures and practices, we can be sure we will be in the strongest possible position when our end-markets return to growth.”
Great Britain and Ireland
In Great Britain revenue increased by 10 per cent YoY to GBP519.6m.The company also completed two bolt-on acquisitions and attributed its positive result to “nimble execution, strong pricing tailwind and careful cost management”.
In Ireland overall revenue was up 11 per cent to GBP109.1m and cement revenue by 18 per cent thanks to sustained strong pricing, enabled by resilient end-market demand. The company also completed the acquisition of Robinson Quarry Masters.
Sustainability
In terms of sustainability achievements, it is a key partner in the launch of the Peak Cluster initiative, an innovative carbon capture and storage collaboration aiming to significantly reduce industry emissions. Breedon Group also improved its alternative fuel substitution of its cement operations to 50 per cent, up from 48.5 per cent in 2022.
