Slide 1: Interim Results 2017
Interim Results 2017
Slide 2: Agenda
Agenda Markets & Trading H1 2017 Strategy & Development Update Outlook & Key Takeaways CRH plc, Interim Results 2017 1
Slide 3: Key Messages
Key Messages • H1 trading in line with guidance … sales & EBITDA ahead of strong H1 2016 • Significant YTD development activity … … $2.63bn agreement to divest Americas Distribution … €0.6bn of H1 bolt-on acquisitions … agreement reached on €0.6bn acquisition of Fels • Reallocation of capital at att
Slide 4: Markets & Trading
Markets & Trading
Slide 5: H1 Financial Highlights
H1 Financial Highlights Sales EBITDA Margin €13.0bn €1,175m 9.0% +2% +5% +20bps +1% LFL +2% LFL in line LFL EPS Dividend €43.5c €19.2c +29% +2% CRH plc, Interim Results 2017 4
Slide 6: Europe – Market Backdrop
Europe – Market Backdrop CRH Main Countries 2017 GDP trends • Recovery continuing … primarily led by residential construction • Sentiment indicators improving … • CRH footprint … economies expanding steadily • Western economies gathering momentum … Eastern Europe remains strong YoY change 0-1.5% >1.
Slide 7: Europe – Trading Performance
Europe – Trading Performance • Positive momentum in key markets … France, H1 LFL % Change Netherlands Sales EBITDA Margin • Strong volume growth in Finland, Poland, Ireland Heavyside +4% +2% -10bps • Solid performance in the UK … outlook stable Lightside +3% - -40bps Distribution +1% +6% +20bps • Ge
Slide 8: Americas – Market Backdrop
Americas – Market Backdrop Res Non-Res Infra 1.5m 1.3bn $200bn • Solid fundamentals in US economy … +25% +30% +80% to 40yr avg. to 25yr avg. to long- term need • US construction markets remain below 1.2m 1.0bn long-term levels • Canadian economy advancing steadily $110bn • Some inflationary pressure
Slide 9: Americas – Trading Performance
Americas – Trading Performance H1 LFL % Change • Satisfactory performance … challenging prior year comps Sales EBITDA Margin Materials +1% +3% +20bps • Poor weather impacting volumes in key markets Products - +7% +80bps • Positive pricing offsetting higher input costs Distribution +1% +10% +40bps •
Slide 10: Asia – Market Backdrop
Asia – Market Backdrop • Environment remains unpredictable … • Major long-term construction needs … impeded by short-term volatility • Difficult trading in the Philippines … political challenges … competitive pressures … imports • India & China improving CRH plc, Interim Results 2017 9
Slide 11: Asia – Trading Performance
Asia – Trading Performance Philippines • Disappointing performance … challenging trading H1 conditions continuing €m Sales EBITDA Margin • Construction activity impacted by political situation Asia 244 34 14% LFL % • Pricing subdued … competition & import pressures Change -8% -39% -720bps India & Ch
Slide 12: Financial Performance
Financial Performance
Slide 13: Components of Performance
Components of Performance €m Sales EBITDA H1 2016 12,693 1,120 • Challenging comparatives … modest Organic (ex-Asia) 204 43 organic growth … good operating leverage Asia (21) (22) • Philippines further downside in H2 Acquisitions/(Disposals) 72 10 • Limited H1 contribution from M&A … timing One-off
Slide 14: Net Debt Movements
Net Debt Movements €m H1 2016 H1 2017 Opening net debt 6,618 5,297 • Disciplined cash management Operating cash (inflow)/outflow (69) 49 & capex control Capital expenditure 408 513 • Increased acquisition activity Acquisitions/(Divestments) 7 487 • Favourable currency translation effects Dividend 23
Slide 15: Strategy & Development Update
Strategy & Develooment Update
Slide 16: Development Update
Development Update … • Significant development activity … • 11 acquisitions completed in H1 … €0.6bn spend … €145m proceeds from disposals • In addition … acquisition of Fels agreed at €0.6bn … creating #2 position in European lime • Agreement to divest Americas Distribution for $2.63bn • Efficient
Slide 17: Divestment of Americas Distribution
Divestment of Americas Distribution • Challenges to original investment thesis • No route to traditional market leadership • Limited opportunities to acquire at prices that create shareholder value • Exit multiple ... 16x EBITDA (2016) … creating significant value for shareholders CRH plc, Interim R
Slide 18: Acquisition of Fels
Acquisition of Fels • CRH becoming #2 player in European lime market … UK, Poland, Ireland … adding Germany & Czech • Attractive growth platform … organic & acquisition • Strong integration benefits … significant synergies • €0.6bn enterprise value … 7x EBITDA (post-synergies) CRH Lime Fels CRH plc,
Slide 19: Outlook
NWN ?
Slide 20: Outlook
Outlook • Europe – economic recovery progressing ... … H2 EBITDA to show continuation of H1 momentum • Americas – solid fundamentals maintained … … H2 EBITDA to be ahead of prior year • Asia – challenging market conditions continue in the Philippines … further declines in H2 EBITDA • Group – another
Slide 21: Key Takeaways
Key Takeaways H1 2017 in line with H2 EBITDA to be ahead guidance of prior year Efficient allocation Significant balance sheet of capital capacity CRH plc, Interim Results 2017 20
Slide 22: Appendices
Appendices
Slide 23: Group Components of Performance
Group Components of Performance Sales Operating Profit Finance Assoc. Pre-tax € million EBITDA revenue profit on disposals costs (net) & JV PAT profit H1 2016 12,693 1,120 588 20 -206 5 407 Exchange effects 49 -1 -3 -1 -4 1 -7 2016/2017 acquisitions 173 16 -1 -3 -4 2016/2017 divestments -101 -6 -1 1
Slide 24: Europe Heavyside
Europe Heavyside Analysis of change Total € million H1 2016* Exchange Acquisitions Divestments LH Costs Organic H1 2017 % Change Change Sales revenue 3,411 -139 +18 -53 - +116 3,353 -58 -2% EBITDA 352 -16 +1 -7 +15 +6 351 -1 - Operating profit 163 -10 - -6 +15 +16 178 +15 +9% EBITDA/sales 10.3% 10.5
Slide 25: Europe Lightside
Europe Lightside Analysis of change Total € million H1 2016* Exchange Acquisitions Organic H1 2017 % Change Change Sales revenue 703 -9 +7 +20 721 +18 +3% EBITDA 59 -1 +1 - 59 - - Operating profit 37 -1 +1 +2 39 +2 +5% EBITDA/sales 8.4% 8.2% Op. profit/sales 5.3% 5.4% *CRH landscaping businesses in
Slide 26: Europe Distribution
Europe Distribution Analysis of change Total € million H1 2016 Exchange Organic H1 2017 % Change Change Sales revenue 1,982 +9 +20 2,011 +29 +1% EBITDA 88 - +5 93 +5 +6% Operating profit 53 - +9 62 +9 +17% EBITDA/sales 4.4% 4.6% Op. profit/sales 2.7% 3.1% CRH plc, Interim Results 2017 25
Slide 27: Americas Materials
Americas Materials Analysis of change Total € million H1 2016 Exchange Acquisitions Divestments LH Costs Organic H1 2017 % Change Change Sales revenue 2,975 +98 +111 -42 - +24 3,166 +191 +6% EBITDA 251 +8 +10 +1 +10 +8 288 +37 +15% Operating profit 61 +2 -4 +4 +10 +14 87 +26 +43% EBITDA/sales 8.4% 9
Slide 28: Americas Products
Americas Products Analysis of change Total € million H1 2016 Exchange Acquisitions Divestments Organic H1 2017 % Change Change Sales revenue 2,249 +66 +37 -6 +9 2,355 +106 +5% EBITDA 264 +8 +4 - +19 295 +31 +12% Operating profit 199 +7 +2 +1 +16 225 +26 +13% EBITDA/sales 11.7% 12.5% Op. profit/sales
Slide 29: Americas Distribution
Americas Distribution Analysis of change Total € million H1 2016 Exchange Organic H1 2017 % Change Change Sales revenue 1,099 +33 +15 1,147 +48 +4% EBITDA 48 +2 +5 55 +7 +15% Operating profit 33 +1 +6 40 +7 +21% EBITDA/sales 4.4% 4.8% Op. profit/sales 3.0% 3.5% CRH plc, Interim Results 2017 28
Slide 30: Asia Division
Asia Division Analysis of change Total € million H1 2016 Exchange Organic H1 2017 % Change Change Sales revenue 274 -9 -21 244 -30 -11% EBITDA 58 -2 -22 34 -24 -41% Operating profit 42 -2 -24 16 -26 -62% EBITDA/sales 21.2% 13.9% Op. profit/sales 15.3% 6.6% CRH plc, Interim Results 2017 29
Slide 31: Cement Volumes & Prices H1 2017
Cement Volumes & Prices H1 2017 YoY % chg Volume Price (LC) YoY % chg Volume Price (LC) Finland +14% -2% Slovakia +8% -1% France +11% -1% Spain +20% +5% Germany -4% - Switzerland -13% -1% Hungary +10% +4% Ukraine -10% +32% Ireland +13% -6% United Kingdom -4% +2% Poland +9% -1% Canada -1% +3% Romania
Slide 32: Americas Materials Volumes & Prices H1 2017
Americas Materials Volumes & Prices H1 2017 YoY % chg Volume Price Aggregates +2% +5% Asphalt +3% +1% RMC -3% +3% CRH plc, Interim Results 2017 31
Slide 33: Euroconstruct Estimates 2017
Euroconstruct Estimates 2017 Total Construction Output Change Total Construction Output Change Austria +1.6% Portugal +3.0% Belgium +1.1% Netherlands +4.1% Denmark +2.2% Poland +4.9% Finland +1.7% Slovakia +4.0% France +4.4% Spain +3.0% Germany +2.0% Switzerland +1.2% Hungary +19.7% United Kingdom +
Slide 34: US Estimates 2017 (PCA)
US Estimates 2017 (PCA) Construction Put-in-Place Change Construction Put-in-Place Change Total Construction Put-in-place +2.1% Hotels, Motels +7.1% Total Residential +3.5% Total Public +0.9% New Housing +4.9% Highways & Streets +1.7% Improvements +0.7% Public Utility & Other +0.9% Total Non-Residen
Slide 35: Disclaimer
Disclaimer In order to utilise the “Safe Harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, CRH public limited company (the “Company”), and its subsidiaries (collectively, “CRH” or the “Group”) is providing the following cautionary statement. This document cont
Slide 36: Contact Information
Contact Information CRH plc Investor Relations Stonemason’s Way Rathfarnham Dublin 16 D16 KH51 Ireland Telephone: +353 1 404 1000 Email: ir@crh.com Website: www.crh.com CRH plc, Interim Results 2017 35
Slide 37: CRH plc Registered Office
Cover Image: The stacker and reclaimer limestone dome at Irish Cement, Platin, Ireland can store up to 40,000 tonnes of crushed limestone at a time. In 2016, the dome handled 1.6 million tonnes of high quality limestone, providing an intermediary between the quarry and the continuous operation requi