Breedon Group has announced record revenue of GBP1487.5m (US$1893.5m) in 2023, up seven per cent from the GBP1396.3m seen in the previous year. EBIT over the same period declined two per cent from GBP148m to GBP145.7m, while profit before tax slipped one per cent from GBP135.8m to GBP134.4m. According to the company, the record revenue was due to improved pricing, which offset a two per cent reduction in volumes, reflecting the challenging macroeconomic conditions.
In terms of volumes, the group sold 2.1Mt of cement in 2023 (2022: 2.2Mt), 25.7Mt of aggregates (2022: 26.3Mt), 3.8Mt of asphalt (2022: 3.8Mt) and 2.9Mm3 of ready-mixed concrete (2022: 3.0Mm3). Volumes moderated over the course of the year with changes in housebuilding regulations in the summer causing ready-mixed concrete volumes to soften in the second half of 2023. Although infrastructure remained resilient, volumes for aggregates and asphalt were impacted by clients’ budget constraints after a long period of building materials cost inflation.
Breedon’s revenue in Great Britain improved six per cent YoY on the back of the group’s “robust market position”, while Ireland saw its revenue advance by four per cent YoY with market conditions improving during 2023. Breedon also completed an important bolt-on acquisition in Ireland, increased its mineral reserves and grew its aggregate and asphalt volumes. Its cement business delivered another record year with revenue ahead 10 per cent YoY thanks to a robust pricing strategy and diversified end-market exposure.
Breedon has also announced its acquisition of BMC Enterprises Inc (BMC) for US$300m, marking the group’s entry into the US.
Commenting on the results, Rob Wood CEO, said, “The record results we delivered in 2023 are a real accomplishment and something I am extremely proud of. The challenging trading conditions our team faced required agile and bold responses which they took with discipline and determination.
Looking ahead, the macroeconomic and geopolitical landscape remains uncertain, says Breedon. “While the near-term outlook for our industry is finely balanced, the longer-term outlook for our main end-markets, infrastructure and housebuilding, is well supported by structural growth dynamics and we are confident we will see them return to growth in the medium-term,” says the group.
“Our M&A pipeline remains well populated with active discussions and, with leverage of 0.5x, our healthy balance sheet, diversified funding and thoughtful approach to capital allocation will enable us to respond swiftly when the right transactions become available. Encouragingly, 2024 has begun with the acquisition in January of Eco-Asphalt Supplies, a Merseyside asphalt supplier with strong sustainability credentials, located within the region where we service the National Highways Pavement framework.”
