8-K

CRH PUBLIC LTD CO 8-K Report (Nov 21, 2017)

Filed November 21, 2017For Securities:CRH

Summary

CRH plc, a global leader in building materials, issued a trading update for the nine months ending September 30, 2017, highlighting continued underlying growth despite some operational headwinds. The company reported a 2% increase in cumulative sales to €20.7 billion and a similar 2% rise in EBITDA to €2.43 billion on a like-for-like basis. The Americas region showed strong performance, particularly in the third quarter, benefiting from stable market fundamentals and good demand, although adverse weather and hurricane activity had some localized impacts. Europe demonstrated positive momentum with like-for-like sales and EBITDA improvements, driven by stabilizing trends and solid market activity, though certain markets faced pricing pressures and mixed demand.

Key Highlights

  • 1CRH plc reported a 2% year-over-year increase in like-for-like sales for the first nine months of 2017, reaching €20.7 billion.
  • 2Like-for-like EBITDA also increased by 2% to €2.43 billion for the same period.
  • 3The Americas region showed robust performance, with Q3 sales up 4% and EBITDA up 2% year-over-year on a like-for-like basis, despite weather impacts.
  • 4Europe delivered positive momentum, with nine-month like-for-like sales up 2% and EBITDA up 3%, anticipating full-year EBITDA to be approximately 4% ahead.
  • 5Asia's performance remained challenging, with like-for-like sales down 9% and EBITDA down 45% year-over-year, primarily due to competitive market conditions.
  • 6CRH expects full-year EBITDA, including discontinued operations, to exceed €3.2 billion, indicating another year of progress.
  • 7The company made significant development activity investments in 2017, spending approximately €1.34 billion on 27 acquisition/investment transactions, including the notable acquisition of Fels in Germany.

Frequently Asked Questions

CRH plc anticipates another year of progress, projecting full-year EBITDA (including discontinued operations) to exceed €3.2 billion, an increase from €3.13 billion reported in 2016. This positive outlook is supported by continued momentum observed in its trading performance.

Adverse weather and hurricane activity did impact some operations in the Americas, particularly in the third quarter. Despite these challenges, the region's underlying performance remained strong, with Q3 sales and EBITDA showing year-over-year growth on a like-for-like basis.

In 2017, CRH invested approximately €1.34 billion in 27 acquisition and investment transactions. A significant acquisition was Fels, a German lime and aggregates business with substantial limestone reserves, which CRH believes will serve as a strong platform for future growth. Additionally, agreements were made to sell its Americas Distribution business and acquire Ash Grove Cement Company, both expected to close in early 2018.

The Asian markets continue to face challenging conditions, particularly the Philippines, characterized by intense competition and lower selling prices, impacting sales and EBITDA significantly. Infrastructure investment in some regions is slower than expected. India shows some growth, while China's volumes are lower due to reduced infrastructure investment.