8-K

CRH PUBLIC LTD CO 8-K Report (Aug 24, 2023)

Filed August 24, 2023For Securities:CRH

Summary

CRH Public Limited Company (CRH) reported strong first-half 2023 financial results, demonstrating robust growth across key metrics despite challenging weather conditions in some regions. Sales increased by 8% year-over-year to $16.1 billion, and EBITDA grew by 14% to $2.5 billion, with an improved EBITDA margin of 15.6%. This performance was driven by strong pricing across most segments, successful integration of acquisitions, and solid demand in key end-use markets, particularly in the Americas. Significant strategic developments include overwhelming shareholder support for CRH's transition to a primary listing on the New York Stock Exchange (NYSE), expected to be effective on September 25, 2023. This move, along with increased cash returns to shareholders through a 4% interim dividend increase and an ongoing $3 billion share buyback program, signals the company's confidence in its future growth and commitment to shareholder value creation. The company also provided a positive outlook, forecasting full-year EBITDA of approximately $6.2 billion.

Key Highlights

  • 1Strong H1 2023 performance with sales up 8% to $16.1 billion and EBITDA up 14% to $2.5 billion.
  • 2EBITDA margin improved by 90 basis points to 15.6%.
  • 3Positive outlook for full-year 2023, with EBITDA expected to be around $6.2 billion.
  • 4Shareholders overwhelmingly supported the transition to a primary listing on the NYSE, effective September 25, 2023.
  • 5Interim dividend increased by 4% to $0.25 per share.
  • 6An ongoing $3 billion share buyback program is underway, with $1 billion completed in H1 2023.
  • 7Acquisitions year-to-date totaled $0.6 billion, with a robust pipeline of opportunities.

Frequently Asked Questions

CRH's revenue and profit growth in H1 2023 were primarily driven by strong pricing across its key markets, the successful integration of prior year acquisitions, and robust underlying demand, particularly in the Americas. Despite some impacts from unfavorable weather, the company's disciplined commercial management and operational efficiencies helped offset cost inflation and contribute to improved EBITDA margins.

The transition to a primary listing on the NYSE, effective September 25, 2023, is a significant strategic move for CRH. Given that North America represents approximately 75% of the Group's EBITDA, this listing is expected to enhance commercial, operational, and acquisition opportunities, further accelerate its integrated solutions strategy, and ultimately drive higher profitability and shareholder returns. It also facilitates potential inclusion in US equity indices.

CRH is returning capital to shareholders through two main avenues: an increased interim dividend and a significant share buyback program. The interim dividend has been raised by 4% to $0.25 per share. Additionally, the company has an ongoing $3 billion share repurchase program, with $1 billion completed in the first half of 2023. These actions reflect management's confidence in the company's financial performance and future outlook.

CRH provided a positive outlook for the full year 2023, anticipating Group EBITDA of approximately $6.2 billion. This forecast is supported by robust infrastructure demand in North America, driven by government funding initiatives, and continued solid infrastructure demand in Europe. While the residential construction market is expected to remain subdued due to interest rates, the company anticipates strong overall performance, assuming normal weather patterns and no major macroeconomic dislocations.