Slide 1: 2012 Results CRH plc
2012 Results CRH plc Albert Manifold Myles Lee Maeve Carton COO CEO FD
Slide 2: Agenda
Agenda Trading Overview Financial Overview Cost Savings 2013 Outlook CRH plc, Preliminary Results 2012 Page 1
Slide 3: Group 2012 Results: Resilient performance
Group 2012 Results Sales €18.7Bn +3% EBITDA €1.64Bn -1% PBT / EPS Like-for-like -2% Ahead of November PBT -5% Resilient FX impact +4% guidance EPS -7% performance - challenging backdrop Net Debt under €3Bn Development Dividend €0.5Bn lower than €0.65Bn activity Maintained at end-2011 +0.6Bn tonnes r
Slide 4: Europe Materials: Good margin delivery despite lower volumes
Europe Materials Good margin Volumes & Prices: €m % chg 2012 2011 delivery Volumes (l-f-l): -7% despite lower Sales -10% 2,685 2,985 Prices (l-f-l): +1% volumes EBITDA -7% 405 436 Op. profit -7% 246 264 CO2 / Pension Gains: EBITDA % 15.1% 14.6% Op. profit % 9.2% 8.8% CO2: €31m (2011: €38m) Pensi
Slide 5: Europe Materials Key points
Europe Materials Key points H1 / H2 Trends: – H1 volumes (l-f-l) -2%; activity recovered after slow weather-related start – H2 volumes (l-f-l) -11%; mainly construction activity slowdown in PL Operational Action: – Cement: Increased alternative fuel usage to 28%* – Procurement: Increased delivery fr
Slide 6: Europe Products: Very tough backdrop, particularly in Netherlands
Europe Products Very tough Pension / Restructuring: backdrop, €m % chg 2012 2011 2012 2011 Pension gain: nil €17m particularly in Restruct.cost: (€27m) (€24m) Sales -6% 2,481 2,648 Netherlands Net cost: (€27m) (€7m) EBITDA -22% 152 194 Impairments: Op. profit -73% 18 66 2012 2011 EBITDA % 6.1% 7.3
Slide 7: Europe Products Key points
Europe Products Key points H1 / H2 Trends: – H1 sales (l-f-l) -5%; Severe early weather & deteriorating confidence – H2 sales (l-f-l) -4%; Slight moderation in negative first half trend Operational Action: – Further rationalisation of production footprint in Concrete and Clay – Ongoing reconfigurati
Slide 8: Europe Distribution: Challenging trading in Netherlands & Switzerland
Europe Distribution Challenging B. Merchants / DIY: trading in €m % chg 2012 2011 Weak Dutch consumer Netherlands confidence Sales -5% 4,140 4,340 & Switzerland EBITDA -14% 230 267 SHAP: Op. profit -19% 154 190 Good overall performance EBITDA % 5.6% 6.2% Margins maintained Op. profit % 3.7% 4.4%
Slide 9: Europe Distribution Key points
Europe Distribution Key points H1 / H2 Trends: – H1 sales (l-f-l) -7%; Sharp NL market decline, CHF currency effect – H2 sales (l-f-l) -6%; As in Products, slight H2 moderation Operational Action: – Strict discipline in pricing and category management – Procurement initiatives mitigated margin press
Slide 10: Americas Materials: US$ profits broadly in line with 2011
Americas Materials US$ profits Results in US$: €m % chg 2012 2011 broadly Sales: +4% in line with Sales +13% 4,971 4,395 EBITDA: -1% 2011 EBITDA +7% 566 530 Op. Profit: -1% Op. profit +7% 282 264 Volumes & Prices: EBITDA % 11.4% 12.1% Volumes (l-f-l): -1% Op. profit % 5.7% 6.0% Prices (l-f-l): +
Slide 11: Americas Materials Key points
Americas Materials Key points H1 / H2 Trends: – H1 sales (l-f-l) +8%; Reflecting benign early weather – H2 sales (l-f-l) -3%; Slower highway contract awards & Hurricane Sandy Operational Action: – Focussed commercial and cost initiatives – Increased usage of Recycled Asphalt Paving & Warm Mix Asphal
Slide 12: Americas Products: Good organic progress in competitive markets
Americas Products Good organic Results in US$: progress in €m % chg 2012 2011 Sales +9% competitive EBITDA +14% Sales +18% 2,806 2,378 markets Op. Profit +90% EBITDA +24% 204 164 Architectural: Op. profit +105% 86 42 Good early weather & EBITDA % 7.3% 6.9% improving Res demand Op. profit % 3.1%
Slide 13: Americas Products Key points
Americas Products Key points H1 / H2 Trends: – H1 sales (l-f-l) +9%; Activity pulled forward with good early weather – H2 sales (l-f-l) +5%; Slower Q3 +4%, but strong finish in Q4 +7% Operational Action: – Driving benefits from consolidated organisation structures – Leveraging commercial capability
Slide 14: Americas Distribution: Overall sales and margin improvement
Americas Distribution Overall sales Results in US$: and margin €m % chg 2012 2011 Sales +9% improvement EBITDA +18% Sales +18% 1,576 1,335 Op. Profit +23% EBITDA +28% 83 65 Exterior Products: Op. profit +31% 59 45 Mild winter; good start EBITDA % 5.3% 4.9% H2 more competitive Op. profit % 3.7% 3
Slide 15: Americas Distribution Key points
Americas Distribution Key points H1 / H2 Trends: – H1 sales (l-f-l) +5%; Good start in both Exterior and Interior products – H2 sales (l-f-l) flat; H1 pull-forward & Sandy effects in Exterior Products Operational Action: – Ongoing consolidation of branch operating structures – Continued strong respo
Slide 16: Agenda
Agenda Trading Overview Financial Overview Cost Savings 2013 Outlook CRH plc, Preliminary Results 2012 Page 15
Slide 17: EBITDA outturn ahead of guidance
Financial Overview EBITDA EBITDA change vs. 2011 Nov IMS 2012 outturn Guidance Outturn ahead of Europe Materials (€) Down c.10% -7% guidance Europe Products (€) Down < 25% -22% Europe Distribution (€) Down c.15% -14% Europe Total (€) Down c.15% -12% Americas Materials ($) Slightly lower -1% Americas
Slide 18: Overall Group PBT €674m
Financial Overview Overall €m % chg 2012 2011 Disposal profits: Group PBT Operating profit -3% 845 871 Businesses: €187m €674m Fixed assets: €43m Profit on disposals 230 55 Net finance costs (289) (257) Finance costs: Share of assoc. PAT (112) 42 Net debt related: €258m Non-debt related: €31m Profit
Slide 19: Cashflow: Strong working capital management
Financial Overview Cashflow €m 2012 2011 Capex: 77% Depreciation Cash inflows (PBT + DA) 1,469 1,496 Strong Continued tight discipline working Working capital (31) (161) capital Capital expenditure (575) (576) management; Disposals: €1.35bn ‘11-’12 Dividends (pre scrip) (450) (445) significant Focus
Slide 20: Very strong and flexible financial position
Financial Overview Very strong Y/E 2012 €Bn Liquidity: and flexible Gross debt 4.8 Y/E cash / undrawn facilities €3.6Bn financial Gross cash (1.8) 2013/14 debt maturities €1.6Bn position Net debt 3.0 Balanced debt maturity profile € Bn Debt Maturity Profile 2.0 Net debt/EBITDA 1.8x 1.5 1.0 EBITDA/In
Slide 21: BBB+ Credit rating unchanged
Financial Overview 8x BBB+ End December 2012 Net Debt / LTM EBITDA Credit rating Europe Peers Americas Peers unchanged 6x 6.2x through 5.7x downturn 4x Best in sector 3.1x 3.3x CRH 2.6x 2.8x 2x 1.8x 1.9x 0x BBB+ BBB- BBB BBB+ BB BB+ BB B- Sources: S&P; Peer data - Davy CRH plc, Preliminary Results 2
Slide 22: Changes in accounting standards - effective 2013
Financial Overview Changes in €m 2012 Joint Pensions Revised accounting Reported Ventures Unaudited standards - Revenue 18,659 (575) - 18,084 effective EBITDA 1,640 (77) - 1,563 2013 Op. profit 845 (40) - 805 Equity accounted (112) 28 - (84) Net finance costs (289) 2 (18) (305) PBT 674 (10) (18) 646
Slide 23: Agenda
Agenda Trading Overview Financial Overview Cost Savings 2013 Outlook CRH plc, Preliminary Results 2012 Page 22
Slide 24: €450m incremental savings targeted 2012-2015F
Cost Savings €450m €m Cumulative Cost Reductions incremental 500 €450m savings 400 €375m targeted 2012-2015F 300 €275m €2.5Bn 200 €166m cumulative savings by 100 end 2015 0 2012 Actual 2013 2014 2015 Structural Process Procurement CRH plc, Preliminary Results 2012 Page 23
Slide 25: €166m delivered in 2012
Cost Savings €166m Examples delivered Europe Materials in 2012 – Alternative Fuels (AF) usage increased to 28%*; co-ordinated procurement Europe Products & Distribution – Consolidated organisational structures Americas Materials – Recycled Asphalt Paving (RAP) increased to 20% of total volume Americ
Slide 26: Further €0.3Bn by end-2015
Cost Savings Further – Ongoing consolidation of production footprints €0.3Bn by Structural – Admin rationalisation and further back office pooling end-2015 – Reduced manning levels – Sustainability focus (AF and RAP) Process – Energy use (Warm Mix Asphalt, cement kiln efficiency) – Improved operatio
Slide 27: Agenda
Agenda Trading Overview Financial Overview Cost Savings 2013 Outlook CRH plc, Preliminary Results 2012 Page 26
Slide 28: 2013 Outlook
Group 2013 – Expect positive momentum in US economy Outlook Americas – Our operations to show progress in 2013 – Will be another challenging year Europe – Internal action to counteract market pressures Overall – US improvements to outweigh pressures in Europe CRH plc, Preliminary Results 2012 Page 2
Slide 29: CRH Strengths
Group CRH Proven Business Model Financial Strength Strengths Responsible approach Strong liquidity to sustainable BBB+ credit rating long-term value creation Dividend Delivery Acquisition Capability Unique Substantial capacity sector record for appropriate development opportunities CRH plc, Prelimin
Slide 30: 2012 Results CRH plc
2012 Results CRH plc Sustainable, Responsible, Ethical International Leader In Building Materials
Slide 31: Group Performance components
Appendices Group €m Sales EBITDA Op. profit Profit on disposals Finance costs Associates PAT PBT 2011 18,081 1,656 871 55 (257) 42 711 Performance components Exchange 748 68 32 2 (12) 3 25 2011/2012 Acquisitions 603 60 33 - (3) - 30 2011/2012 Divestments (389) (46) (23) 160 2 - 139 Restructuring cos
Slide 32: Europe Materials Performance components
Appendices Europe Analysis of change Materials €m % chg 2012 2011 Change Organic Acquisitions Divest. Restruct. Exchange Performance Sales -10% 2,685 2,985 (300) (222) +78 (182) - +26 components EBITDA -7% 405 436 (31) (11) +14 (40) +6 - Op. profit -7% 246 264 (18) (8) +9 (24) +6 (1) EBITDA % 15.1
Slide 33: Europe Products Performance components
Appendices Europe Analysis of change Products €m % chg 2012 2011 Change Organic Acquisitions Divest. Restruct. Exchange Performance Sales -6% 2,481 2,648 (167) (111) +125 (207) - +26 components EBITDA -22% 152 194 (42) (51) +15 (6) (3) +3 Op. profit -73% 18 66 (48) (48) +9 +1 (12) +2 EBITDA % 6.1%
Slide 34: Europe Distribution Performance components
Appendices Europe Analysis of change Distribution €m % chg 2012 2011 Change Organic Acquisitions Divest. Restruct. Exchange Performance Sales -5% 4,140 4,340 (200) (294) +65 - - +29 components EBITDA -14% 230 267 (37) (42) +2 - +1 +2 Op. profit -19% 154 190 (36) (42) +1 - +3 +2 EBITDA % 5.6% 6.2%
Slide 35: Americas Materials Performance components
Appendices Americas Analysis of change Materials €m % chg 2012 2011 Change Organic Acquisitions Divest. Restruct. Exchange Performance Sales +13% 4,971 4,395 +576 +40 +168 - - +368 components EBITDA +7% 566 530 +36 (25) +20 - (5) +46 Op. profit +7% 282 264 +18 (12) +12 - (5) +23 EBITDA % 11.4% 12.
Slide 36: Americas Products Performance components
Appendices Americas Analysis of change Products €m % chg 2012 2011 Change Organic Acquisitions Divest. Restruct. Exchange Performance Sales +18% 2,806 2,378 +428 +174 +67 - - +187 components EBITDA +24% 204 164 +40 +21 +5 - +2 +12 Op. profit +105% 86 42 +44 +39 +1 - +2 +2 EBITDA % 7.3% 6.9% Op. pr
Slide 37: Americas Distribution Performance components
Appendices Americas Analysis of change Distribution €m % chg 2012 2011 Change Organic Acquisitions Divest. Restruct. Exchange Performance Sales +18% 1,576 1,335 +241 +29 +100 - - +112 components EBITDA +28% 83 65 +18 +9 +4 - - +5 Op. profit +31% 59 45 +14 +9 +1 - - +4 EBITDA % 5.3% 4.9% Op. profit
Slide 38: Changes in accounting standards – balance sheet
Financial Overview Changes in 2012 Joint Revised €m accounting Reported Ventures Unaudited standards – Non-current assets 14,168 (71) 14,097 effective Current assets 7,000 (191) 6,809 2013 Total assets 21,168 (262) 20,906 Non-current liabilities 6,781 (165) 6,616 Current liabilities 3,814 (97) 3,717
Slide 39: Acquisition Activity c.€0.65Bn
Appendices 2012 €Bn H1 2012 H2 2012 Full Year Acquisition Activity Eur / Asia 0.18 0.13 0.31 c.€0.65Bn Americas 0.08 0.26 0.34 Group 0.26 0.39 0.65 Acquisitions: €0.65Bn – 11 Europe deals (4 Materials; 4 Products; 3 Distribution) – 25 Americas deals (16 Materials; 9 Products) 38 CRH plc, Preliminary
Slide 40: Analysis by segment: Sales and EBITDA
Appendices Analysis by Sales (€m) % chg 2012 2011 EBITDA (€m) % chg 2012 2011 segment Europe Materials -10% 2,685 2,985 Europe Materials -7% 405 436 Europe Products -6% 2,481 2,648 Europe Products -22% 152 194 Europe Distribution -5% 4,140 4,340 Europe Distribution -14% 230 267 Americas Materials 13
Slide 41: Analysis by segment: Operating profit and disposals
Appendices Analysis by Op. profit (€m) % chg 2012 2011 Profit on disposal (€m) 2012 2011 segment Europe Materials -7% 246 264 Europe Materials 148 14 Europe Products -73% 18 66 Europe Products 54 20 Europe Distribution -19% 154 190 Europe Distribution 3 7 Americas Materials 7% 282 264 Americas Mater
Slide 42: Euroconstruct Construction Output 2012 estimates
Appendices Euroconstruct Construction Output 2012 % chg Construction Output 2012 % chg estimates Belgium 0.2% Poland 1.6% 2012 Denmark 0.5% Portugal (14.6%) Finland (3.4%) Spain (30.8%) France 0.3% Switzerland 1.1% Germany (0.2%) United Kingdom (6.6%) Ireland (15.0%) Western Eu
Slide 43: PCA (US) estimates 2012
Appendices PCA (US) Real GDP 2.2% Construction Put-in-place % chg estimates Construction Put-in-place 6.2% Industrial 10.1% 2012 Cement consumption 9.0% Office 16.7% Construction Put-in-place % chg Hotels, motels 26.3% New housing 25.5% Total Non-residential 9.5% Single family 23.2%
Slide 44: Contact Us
CRH plc Contact Us CRH plc Investor Relations Belgard Castle Clondalkin Dublin 22 Ireland Phone: + 353 1 404 1000 Fax: + 353 1 404 1007 Email: ir@crh.com Website: www.crh.com This presentation contains certain forward‐looking statements as defined under US legislation. By their nature, such statemen