CRH shares jump as Irish buildings materials group’s sales, margins and earnings rise amid booming demand
- CRH shares rose sharply on the FTSE 100 today amid upbeat trading update
- The group is upbeat about its projects for the first half after strong first quarter
Building materials group CRH enjoyed a boost to its sales, earnings and margins in the first quarter.
CRH shares have risen sharply on the FTSE 100 index today, and were up 4.84 per cent or 147.00p to 3,184.00p in late morning trading, but remain down from their value a year ago.
The group, which is based in Ireland, expects sales, earnings and margins to come in in higher than expected by the end of the first half of 2022.
On the rise: Building materials group CRH enjoyed a boost to its sales, earnings and margins in the first quarter
Albert Manifold, chief executive of CRH, said: ‘The continued delivery of our solutions strategy resulted in a good start to the year.
‘Although a number of challenges and uncertainties continue, our demand backdrop remains favourable and absent any major dislocations in the macroeconomic environment, we expect first-half sales, EBITDA and margin to be ahead of the prior year period.’
First quarter sales in its building materials division were up 22 per cent compared to the same point a year ago.
The group said it had spent around $600million on 11 acquisitions so far this year, the biggest of which were the purchase of Rinker Materials and the acquisition of Calstone Company in Architectural Products, a provider of outdoor living solutions in California.
On the divestment front, it completed about $30million of business and asset disposals. The divestment of its Building Envelope business for an enterprise value of $3.8billion is expected to close in the second quarter of this year.
In March, CRH announced it was exiting the Russian market in the wake of the country’s invasion of Ukraine.
The group is also a major supplier of cement to Ukraine.
In today’s trading update, CRH said: ‘As the conflict in Ukraine continues to unfold and many of our markets continue to be affected by the impact of Covid-19, the health and safety of our people remains our number one priority.
‘Our approach is to ensure that we provide a safe working environment for our employees, contractors and customers, enabling them to carry out their activities in accordance with the various health and safety protocols currently in place across our markets.’
Looking ahead, the group said: ‘Overall, assuming normal seasonal weather patterns and absent any major dislocations in the macroeconomic environment, we expect Group sales, EBITDA and margin for the first half of the year to be ahead of 2021 (H1 2021 EBITDA: $2.0billion).
‘We expect the positive demand environment in North America to continue, which, in addition to the continued delivery of our integrated solutions strategy and good commercial management, should positively impact both our Americas Materials and Building Products businesses.
‘Despite the challenges of significant energy cost volatility and the ongoing conflict in Ukraine, we expect like-for-like EBITDA in our Europe Materials business to be ahead of the prior year period.’