8-K

CRH PUBLIC LTD CO 8-K Report (Nov 24, 2015)

Filed November 24, 2015For Securities:CRH

Summary

CRH Public Limited Company's (CRH) interim management statement, filed on November 24, 2015, highlights a strong performance driven by continuing operations, particularly in the Americas. The company reported a 16% increase in cumulative sales from continuing operations to €15.5 billion for the nine months ended September 30, 2015, with a significant 28% rise in the Americas. EBITDA from continuing operations saw a substantial 34% increase to €1.5 billion, with the Americas region contributing a remarkable 55% growth. The company also provided an optimistic full-year outlook, expecting 2015 EBITDA from continuing operations to be approximately 25% ahead of 2014. The integration of businesses acquired from Lafarge/Holcim is progressing well and is expected to contribute around €0.34 billion to the full-year results. CRH is actively managing its portfolio through a divestment program, having generated €0.74 billion in proceeds year-to-date, and remains committed to financial discipline and restoring debt metrics to normalized levels in 2016.

Key Highlights

  • 1Cumulative sales from continuing operations increased by 16% to €15.5 billion for the first nine months of 2015 compared to the same period in 2014.
  • 2EBITDA from continuing operations grew by 34% to €1.5 billion for the first nine months of 2015.
  • 3The Americas region showed robust growth, with sales up 28% and EBITDA up 55% for the nine-month period.
  • 4CRH reiterates its guidance for 2015, expecting full-year EBITDA from continuing operations to be approximately 25% ahead of 2014.
  • 5Integration of acquired Lafarge/Holcim assets is on track, expected to contribute approximately €0.34 billion to 2015 EBITDA.
  • 6The company has generated €0.74 billion in divestment proceeds year-to-date as part of its multi-year divestment program.
  • 7Net debt is expected to be less than €7.5 billion by year-end 2015, with a commitment to restore debt metrics to normalized levels in 2016.

Frequently Asked Questions

The primary driver is the strong performance of CRH's continuing operations, particularly in the Americas, where continued economic recovery is boosting construction demand. Operational leverage from its vertically integrated business model for heavyside materials has also contributed to improved margins and returns.

The integration of the acquired businesses is progressing well and is expected to contribute approximately €0.34 billion to CRH's 2015 EBITDA. However, this is before accounting for one-off transaction and integration costs totaling around €0.2 billion.

CRH reported a net debt of €8.0 billion at the end of September 2015, significantly higher due to acquisition spending. The company is committed to financial discipline and expects to restore its debt metrics to normalized levels in 2016, aided by ongoing divestment proceeds and strong operating cash flow conversion.

CRH expects 2015 to be a year of growth. For continuing operations, full-year EBITDA is anticipated to be approximately 25% ahead of 2014. Including the acquired Lafarge/Holcim assets and factoring in divestments and one-off items, the overall EBITDA for the year is estimated to be around €2.08 billion, well ahead of the prior year.