4th May 2005 15:05
CRH PLC04 May 2005 CHAIRMAN'S UPDATING STATEMENT ANNUAL GENERAL MEETING - 4th MAY 2005 Overall trading in the first four months has been positive with a strong startto the year in our American operations partly offset by the effects of severeMarch weather in Northern Europe which hampered activity in a number of ouroperations. In our Europe Materials operations, despite some variations in demand, overallvolumes are broadly in line with 2004 and price increases necessary to recoverhigher energy and other input costs are being implemented in most markets. Irishconstruction activity continues at a strong level with volumes ahead in mostproduct categories. Our operations in Finland and Switzerland have recovered inApril from weather related setbacks in March. Although demand in Poland has beenparticularly affected by late winter weather the outlook is positive as we moveinto the busier months in that country. The trends to date in our Iberianoperations are encouraging and 2005 will of course benefit from a full year'scontribution from our investment in Secil which was finalised in June 2004. The overall economic backdrop for our Europe Products & Distribution activitiesin the Benelux, Germany and France remains subdued and trading over the earlyless busy months was not helped by severe March weather. These conditionsimpacted demand in our Concrete operations, but our Clay and Building Productsbusinesses have had a more positive start to the year. Insulation operationscontinue to suffer from volatility in energy-related input costs. InDistribution, while Builders Merchants sales were hampered by poor Marchweather, our DIY activities have been less affected. Although the construction season for our Americas Materials Division has yet toget fully underway in many of our market areas, activity levels to date haveexceeded expectations. The indications from early awards of highway sectorpaving contracts suggest good progress in our efforts to improve product pricesand recover higher input costs, while backlogs are solid. Negotiations on therenewal of TEA-21, the US Federal highway programme which will underpin demandin future years, are progressing with finalisation anticipated in the comingmonths. In the Americas Products & Distribution Division, our Precast, ArchitecturalProducts and Glass Groups in North America have all had a positive start to theyear against a backdrop of sustained strong residential activity and ongoingimprovement in non-residential demand. The Distribution Group has performedparticularly strongly through the quieter early months and continues to build onthe significant progress of recent years. Despite higher input costs our SouthAmerican operations are performing ahead of expectations. To date in 2005, CRH has completed acquisitions totalling approximately euro 100million, comprising 15 deals. Although a lower pace of spend than in recentyears we see significant opportunities for acquisitions across our operationsand remain committed to completing transactions at prices that will contributeto long-term value creation for our shareholders. Energy markets remain volatile and higher input costs are generally a featureacross our operations. However, we are encouraged by results to date inachieving cost recovery and look to further gains in this regard in the busiermonths ahead. While as always there are uncertainties in economies and markets, overall 2005has started well and with our sustained focus on cost effectiveness andoperational performance we look to continuing progress as we move into the moreprofitable second half of the year. This updating statement contains certain forward-looking statements as definedunder US legislation. By their nature, such statements involve uncertainty; as aconsequence, actual results and developments may differ from those expressed inor implied by such statements depending on a variety of factors including thespecific factors identified in this trading update and other factors discussedin our Annual Report on Form 20-F filed with the SEC. CRH plc, Belgard Castle, Clondalkin, Dublin 22, Ireland TELEPHONE +353.1.4041000 FAX +353.1.4041007 E-MAIL [email protected] WEBSITE www.crh.com Registered Office, 42 Fitzwilliam Square, Dublin 2, Ireland This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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