26th Aug 2021 08:54
(Alliance News) - Irish building materials firm CRH PLC on Thursday said sales and profit increased in its first half, supported by ongoing strength in its North American and European markets.
The FTSE 100 constituent reported revenue of USD14.04 billion in the six months that ended June 30, up 15% from USD12.22 billion at the same time last year and 9.3% above the USD12.85 billion recorded two years earlier.
Pretax profit doubled year-on-year to USD1.05 billion from USD518 million. Profit before tax rose 46% in the first half in comparison with USD717 million reported during that same period in 2019.
CRH posted earnings before interest, tax, depreciation and amortisation of USD2.0 billion, 25% ahead of USD1.6 billion seen last year. In the full-year, the company said it expected to see earning ahead of its record year in 2020.
CRH said its results reflected strong volume growth as well as a continued focus on price improvements and cost rationalisation, which more than offset the effects of input cost inflation.
Sales revenue for the European Materials segment increased by 27% to USD5.16 billion in the first half from USD4.07 billion a year prior.
The European segment's earnings before interest, tax, depreciation and amortisation jumped 73% to USD585 million from 338 million, whilst operating profit shot up to USD295 million from just USD62 million the previous year.
CRH said its improved comparative results in its European segment reflected both strong demand and the negative impact of the Covid-19 pandemic on the previous year.
Meanwhile in its American Materials division, sales revenue grew 6.0% to USD4.75 billion from USD4.48 billion a year prior. The American region saw operating profit rise 20% to USD348 million from USD289 million.
"The increase in sales was driven by price progression across all lines of business and improved volumes in aggregates, cement and ready-mixed concrete, as some regions were impacted by pandemic restrictions in the second quarter of 2020," CRH added.
Finally, the Building Products Division saw sales build in the first half, up 13% to USD4.14 billion from USD3.67 billion in that period last year. Operating profit reached USD504 million, the company said, 22% higher year-on-year from USD413 million in the first six months of 2020.
The "Building Products Division is expected to continue to benefit from positive residential demand, with early signs of recovery in non-residential activity," CRH said.
CRH declared an interim dividend of 23 US cents, up 4.5% from 22 cents paid out last year.
Looking ahead, the Dublin-based company said it is encouraged by the progress being made in relation to the Biden administration's plans for infrastructure spending in the US.
US President Joe Biden's plans to spend nearly USD5 trillion to change the world's largest economy advanced in the House of Representatives earlier this week, after Democratic leaders reached an agreement with centrist lawmakers to end a dispute threatening the bills.
Biden and his Democratic allies controlling the chamber are pushing for passage of both a USD1.2 trillion infrastructure overhaul and a bill costing USD3.5 trillion over 10 years that would pay for improvements to education, health care and climate change resiliency.
Turning to Europe, CRH said it expects solid construction demand in its key markets to continue into the second half and beyond.
Chief Executive Albert Manifold said: "I am pleased to report a good first half as the strength and resilience of our business model once again delivers superior performance for CRH. Our integrated and solutions-focused approach leaves us uniquely positioned for the changing needs of construction, while our continued strong cash generation provides us with the flexibility to invest in future growth opportunities for our business. Based on current trading conditions and the positive momentum that we see across our markets, we expect second-half group Ebitda to be ahead of a record prior year."
Shares in CRH were trading up 1.3% at 3,821.00 pence each in London on Thursday morning.
By Scarlett Butler; [email protected]
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