8-K

CRH PUBLIC LTD CO 8-K Report (Mar 2, 2005)

Filed March 2, 2005For Securities:CRH

Summary

CRH Public Limited Company (CRH) reported a landmark year for 2004, achieving a profit before tax exceeding one billion euro for the first time, a significant 18% increase over 2003. This strong performance was driven by robust organic growth across its divisions, complemented by substantial contributions from acquisitions made during the year. Despite challenges such as escalating energy prices and the weakening US dollar, CRH demonstrated resilience and strategic execution, leading to an impressive 19% increase in operating profit on a reported basis. The company has a consistent history of shareholder returns, highlighted by a 17.4% increase in the proposed dividend per share, marking the 21st consecutive year of dividend growth. CRH's strategic focus on development activities, supported by a strong balance sheet and cash flow, positions it for continued progress. The company's outlook for 2005 remains positive, with expectations of solid economic growth in the US and continued progress in its European operations, despite some anticipated market fluctuations.

Key Highlights

  • 1Profit before tax surpassed €1 billion for the first time in 2004, reaching €1,017 million, an 18% increase year-over-year.
  • 2Sales grew by 16% to €12,820 million, or 22% in constant currency, driven by strong organic growth and acquisitions.
  • 3Operating profit increased by 19% to €1,247 million (25% in constant currency), reflecting successful integration of acquisitions and operational improvements.
  • 4Earnings per share (excluding goodwill amortization) rose by 20% to 163.1 euro cents.
  • 5The company recommended a final dividend of 23.4 euro cents per share, increasing the total dividend for the year by 17.4% to 33.0 euro cents, marking the 21st consecutive year of dividend growth.
  • 6Total development expenditure for the year was €1 billion, focused on strategic acquisitions and capital projects across its global operations.
  • 7Despite facing challenges such as rising energy costs and a weaker US dollar, CRH maintained a positive outlook for 2005, anticipating continued progress.

Frequently Asked Questions

CRH's 2004 performance was primarily driven by a combination of excellent full-year organic growth across its business segments and a significant incremental contribution from acquisitions. The company also benefited from more favorable weather conditions in many regions compared to the previous year and a focus on operational efficiencies and cost reductions.

The weakening US dollar had a negative translation impact on reported euro-denominated results, reducing profit before tax by over €40 million. Additionally, escalating energy prices, particularly in the third quarter, eroded the benefits of price improvements for some divisions, especially the Americas Materials division, although cost reduction efforts helped mitigate some of this impact.

CRH has a positive outlook for 2005, expecting solid economic growth in the US and continued progress in its European operations. However, the company acknowledges ongoing volatility in energy and currency markets, which could adversely affect economies. Specific challenges include potential moderation in Irish construction due to housing market adjustments and the timing of US federal transportation funding re-authorization, which could impact highway markets.

CRH invested approximately €1 billion in total development activities in 2004, which included significant acquisitions across its Materials and Products & Distribution divisions in Europe and the Americas. The company continues to focus on acquiring strategically located assets, expanding its market presence, and integrating new businesses to drive growth, supported by a strong balance sheet and cash flow.