The building materials corporation, CRH, declared their six month interim figures, noticing a boost of 20% in net income, $1.4 billion, compared to 2023, despite no growth in revenues which remained at $16.2 billion. A slight dip in revenues to $9.7 billion was reported for the three months ending in June, however, an 8% increase in post-tax profit, rising to $1.3 billion was observed. According to CRH, the profit margin improved by just over one percent, rising to 13.6%.
Boosted by improved earnings before interest, tax, depreciation and amortisation (Ebitda), CRH declared a 12% increase in its second quarter performance, lifting it to $2.3 billion. The corporation highlighted that “Positive pricing and contributions from acquisitions alleviated the affect of decreased activity levels due to inclement weather and divestitures, including the first two phases of the European Lime operations.”
Albert Manifold, CRH’s CEO, noted his satisfaction with yet another period of enhanced profit growth and margin expansion for his company. He credited the firm’s unique solutions strategy for delivering strong financial performance and pointed towards robust financial management and capital allocation as key factors in capitalising on growth and value formation opportunities.
The company was de-listed from Dublin after moving its primary stock listing to the New York Stock Exchange in the previous September. On the back of the results, CRH shares traded in London rose 2.54% in early trading.
Davy analyst, Ross Harvey praised CRH’s “excellent” second quarter, despite significant weather disruption in North America and western Europe. The performance exceeding consensus forecasts among analysts by 5%.He noted an improvement in both organic and M&A contributions and highlighted that while its industry counterparts have decreased their annual guidance by up to 7%, CRH has increased its guidance by 3%. Harvey added that CRH’s distinctive strategy is expected to drive outperformance into the second half of the year and beyond.
The text talks about appreciable non-residential and infrastructure operations in North America, though residential activity is expected to remain calm. Europe, however, is witnessing strong demand for infrastructure and major non-residential markets, assisted by cost regulation.
The firm apprised its shareholders about its share buyback scheme, during which it bought 3.8 million shares from May to August. This makes the total value of shares repurchased by the conglomerate since May 2018 a whopping $7.9 billion.
The company has confirmed a share repurchase agreement worth $300 million effective till November 6th. This allows them to purchase up to a maximum of 55 million regular shares, according to CRH.
Positive growth in the Americas Materials Solutions was significant. It saw robust organic EBITDA growth in Q2 (24.5%), propelled by cost-control measures, price strategies, and operational effectiveness ensuring the best use of leverage. Importantly, construction backlogs surpassed the previous year, and bid activity showed promising momentum. There was also positive organic EBITDA growth in Europe Materials Solutions due to increased pricing and solid execution that took advantage of lower energy expenses.
Whilst Americas Building Solutions experienced stagnant new-build residential volumes and volume challenges linked to the weather, they managed to maintain stable organic EBITDA, as profit margins increased. This was due to impressive progress in water and energy end-markets as well as the growth of high-margin products in Outdoor Living Solutions. Europe Building Solutions showed improvement sequentially, owing to prudent commercial management and cost-reduction measures.