Slide 1: 2017 Results
2017 Results CRH777 Results 2017 Presentation_cover.indd 1 23/02/2018 14:57
Slide 2: Key Messages
Key Messages • Record profit delivery … €3.3bn EBITDA • Margins & returns ahead for 4th consecutive year … continuing our business improvement programmes • Effective portfolio management … allocating capital for growth & returns • €2.2bn net cash inflow … 1.8x net debt/EBITDA CRH plc, Preliminary Re
Slide 3: 2017 Financial Highlights
2017 Financial Highlights Sales EPS €27.6bn +2% +2% LFL €2.27 +51% +11% excl.one-offs EBITDA DPS €3.3bn +6% +3% LFL €0.68 +5% EBITDA Margin RONA 12.0% +50bps +10bps LFL 10.6% +90bps +60bps excl.one-offs *Figures shown refer to combined results from continuing and discontinued operations CRH plc, Pre
Slide 4: Americas Trading Performance
Americas Trading Performance
Slide 5: Americas – Market Backdrop
Americas – Market Backdrop • Weather impacted construction season • Infrastructure investment underpinned • Positive Res & Non-Res trends • Margin improvement despite input cost pressures CRH plc, Preliminary Results 2017 4
Slide 6: Americas Materials – Trading Performance
Americas Materials – Trading Performance Change vs. 2016 • Volumes & prices ahead despite weather disruption 2017 €m LFL • Record margins amid energy headwinds … Sales 7,970 +5% +3% 20%+ operating leverage … structural improvements EBITDA 1,270 +5% +4% • Strong backlogs … volumes & margin Margin 15.
Slide 7: Americas Products – Trading Performance
Americas Products – Trading Performance Change vs. 2016 • Volumes impacted by weather, but 2017 €m LFL … favourable market conditions in Res & Non-Res Sales 4,327 +1% +1% • CRL performing strongly … ahead of expectations EBITDA 573 +6% +5% • Good margin delivery in competitive environment Margin 13.
Slide 8: Americas Distribution – Trading Performance
Americas Distribution – Trading Performance Change vs. 2016 • Strong delivery in final year of ownership 2017 €m LFL • Reallocating $2.63bn of capital into higher growth Sales 2,343 +1% +3% regions with higher margins & sustainable returns EBITDA 164 +9% +12% • Divestment completed in January 2018 …
Slide 9: Europe & Asia Trading Performance
Europe & Asia Trading Performance
Slide 10: Europe – Market Backdrop
Europe – Market Backdrop • Economic momentum improving … Euro Area GDP +2.5% in 2017 • Sentiment indicators positive … good growth in Res, Non-Res & Infra markets • Major markets performing well … Benelux, Germany, France, Finland, Poland • UK broadly stable … Switzerland challenging CRH plc, Prelim
Slide 11: Europe Heavyside – Trading Performance
Europe Heavyside – Trading Performance • Cement volumes & prices ahead in most markets Change vs. 2016 2017 €m LFL • Good operating leverage ... 25%+ Sales 6,902 -1% +3% • Margin expansion despite input cost inflation … strong commercial discipline EBITDA 839 +7% +6% Margin 12.2% +100bps +40bps • Ea
Slide 12: Europe Lightside – Trading Performance
Europe Lightside – Trading Performance • Good growth across all product segments Change vs. 2016 • Performing well in major markets … UK, Germany, 2017 €m LFL Netherlands Sales 1,440 +3% +4% • Focus on margin improvement from cost control EBITDA 143 +4% +5% & product mix optimisation Margin 9.9% +10
Slide 13: Europe Distribution – Trading Performance
Europe Distribution – Trading Performance • Strong performances in the Netherlands, Change vs. 2016 Belgium & Germany 2017 €m LFL • Switzerland remained challenging Sales 4,145 +2% +2% • Management focus on cost control EBITDA 269 +31% +1% & performance improvement initiatives Margin 6.5% +140bps -
Slide 14: Asia Division – Market Backdrop & Trading Performance
Asia Division – Market Backdrop & Trading Performance • Challenging trading environment in the Philippines Change vs. 2016 • Strong headwinds from imports, cost inflation 2017 €m LFL & competitive pressures Sales 436 -14% -7% • Early signs of volume & price recovery for 2018 EBITDA 52 -52% -53% Marg
Slide 15: Financial Performance
Financial Performance
Slide 16: Components of Performance
Components of Performance €m Sales EBITDA 2016 27,104 3,130 • Strong operating leverage ex-Asia Organic (excl. Asia) 626 144 • Benefiting from one-off pension adjustment & Organic Asia (33) (52) non-recurrence of prior year integration costs Acquisitions/(Disposals) 392 39 • Significant currency hea
Slide 17: Cash Flow Movements
Cash Flow Movements €m 2016 2017 EBITDA 3,130 3,310 • ~70% conversion of EBITDA to Cash Working Capital 56 (209) Interest (346) (317) • % WC/Sales … consistent with 2016 Tax (481) (474) • Savings on Interest and Tax Other (19) (121) Net Cash Inflow 2,340 2,189 CRH plc, Preliminary Results 2017 16
Slide 18: Proforma Net Debt Bridge
Proforma Net Debt Bridge €bn 1.7 2.8 (2.2) (2.2) 1.0 5.8 6.4 5.3 $2.6bn $3.5bn Proforma FY16 Net Cash Dividends, Acquisitions/ FY17 Allied Ash Grove FY17 Net Debt Inflow FX & Capex Divestments Net Debt Divestment Acquisition Net Debt Net Debt/EBITDA 1.7x 1.8x 1.8x Proforma … maintaining our financia
Slide 19: Focused Growth
Focused Growth
Slide 20: 2017 Development Activity
2017 Development Activity • ~€5bn development activity … including ~€0.7bn on 30+ bolt-ons … primarily cement, aggregates & RMC in North America … new lime platform in Europe • Efficient reallocation of capital … higher growth & more sustainable returns • Developing new growth platforms … strengthen
Slide 21: Growth Platform in European Lime
Growth Platform in European Lime • Now #2 in Europe post Fels acquisition … ~€120m EBITDA lime platform • Increased exposure to new & innovative growth area • Strong fit with existing lime businesses … significant value creation opportunities • Attractive platform for future growth … organic and M&A
Slide 22: US Growth Platforms
US Growth Platforms … Ash Grove & Florida Assets 2017 $ 1.7bn $0.4bn 9.4mt Sales EBITDA Cement 3.9m yd 3 >13mt ~1.7bn t Readymixed Aggregates Reserves CRH Concrete Ash Grove/Florida … strengthened footprint CRH plc, Preliminary Results 2017 21
Slide 23: FL, TX & Northwest – Strengthening in Key Growth Markets
FL, TX & Northwest – Strengthening in Key Growth Markets WA • Reallocating capital to high growth markets ... OR MT ID now #1 in Florida, Texas & Northwest • Population in these markets to increase ~40% NV next 20yrs … 2x national average UT • Significant self-supply, downstream & development opport
Slide 24: Midwest – Strong Market Position & Geographic Infill
Midwest – Strong Market Position & Geographic Infill • #1 market position in cement NE IA • Strong overlap with existing business ... strengthening market footprint KS MO OK • Expanding aggregates business by ~50% AR • Fully integrated across all product lines … LA network optimisation benefits CRH
Slide 25: Adding Value Through Integration
Adding Value Through Integration Leveraging global Network expertise optimisation Best practice initiatives adding … Across all product groups value to acquired businesses Vertical integration Self-supply benefits opportunities Downstream expansion ... Aggs & Enhanced purchasing & self-supply Cement
Slide 26: Significant Synergy Potential
Significant Synergy Potential • Ash Grove – initially estimated $80m over 3 years ... now expect $100m+ • Florida acquisition to add a further ~$20m • Procurement – global purchasing & supply arrangements • Operational – alternative fuels; operating efficiencies; vertical integration benefits • Stru
Slide 27: Building a Better Business
Building a Better Business
Slide 28: Repositioning our Business
Repositioning our Business Group Financial Summary • Divestment of non-core & underperforming businesses … 2013 2017* Sales reallocation of capital for higher growth & returns €18bn €28bn • From a manufacturer of basic materials … EBITDA … to a fully integrated provider €1.5bn €3.2bn … of a broader
Slide 29: Performance Delivery in Europe
Performance Delivery in Europe Europe Financial Summary • Significant growth … supported by acquisitions 2013 2017* Sales • Relentless focus on performance optimisation within €8.6bn €12.5bn acquired businesses … integration benefits realised EBITDA €0.6bn €1.2bn • Portfolio refinement & efficient r
Slide 30: Americas Products
Americas Products APG • Pavers • Hardscapes 2013 2017 From Concrete Pavers, to … • Masonry Sales • Composite Decking • Lawn & Garden €3.1bn €4.3bn EBITDA €246m €573m OBE EBITDA Margin • Tempered Glass • Curtain Wall 8.0% 13.2% From Tempered Glass, to … • Entrance Systems • Framing Solutions RONA • G
Slide 31: Americas Materials
Americas Materials • Aggregates • Asphalt 2013 2017 From Aggregates, to … • Cement Sales • RMC • Concrete Products €4.7bn €8.0bn EBITDA €0.6bn €1.3bn • Now uniquely leveraging our aggregates positions … across a wider range of end-use products EBITDA Margin 11.8% 15.9% • From basic materials to full
Slide 32: Focus on Long-Term Value
Focus on Long-Term Value • Well positioned with strong market positions Performance • Significant performance delivery … margins & returns ahead last 4 years • Active portfolio management … reallocating capital for growth & returns Growth • Healthy acquisition pipeline … firm focus on shareholder va
Slide 33: 2018 Outlook
2018 Outlook
Slide 34: 2018 Outlook
2018 Outlook • Americas – Continued market expansion • Europe – Recovery gathering momentum • Asia – Stabilisation expected in the Philippines • Group – Improved performance & continued growth CRH plc, Preliminary Results 2017 33
Slide 35: Appendices
Appendices CRH plc, Preliminary Results 2017 34
Slide 36: Group Components of Performance (Continuing Operations)
Group Components of Performance (Continuing Operations) Sales Operating Profit on Finance Assoc. and Pre-tax € million EBITDA revenue profit disposals costs (net) JV PAT1 profit 2016 24,789 2,980 1,908 53 (383) 42 1,620 Exchange effects (479) (74) (53) (1) 6 1 (47) 2016 at 2017 rates 24,310 2,906 1,
Slide 37: Americas Materials
Americas Materials Analysis of change € million 2016 Exchange Acquisitions Divestments LH costs1 Organic 2017 % Change Sales revenue 7,598 -123 +379 -80 - +196 7,970 +5% EBITDA 1,204 -24 +46 -5 +7 +42 1,270 +5% Operating Profit 818 -19 +12 -2 +7 +42 858 +5% EBITDA/sales 15.8% 15.9% Op. profit/sales
Slide 38: Americas Products
Americas Products Analysis of change € million 2016 Exchange Acquisitions Divestments Organic 2017 % Change Sales revenue 4,280 -79 +87 -14 +53 4,327 +1% EBITDA 543 -10 +10 +1 +29 573 +6% Operating Profit 411 -8 +4 +2 +26 435 +6% EBITDA/sales 12.7% 13.2% Op. profit/sales 9.6% 10.1% CRH plc, Prelimin
Slide 39: Europe Heavyside
Europe Heavyside Analysis of change LH costs/ € million 20161 Exchange Acquisitions Divestments Pension Organic 2017 % Change credit2 Sales revenue 6,945 -203 +95 -110 - +175 6,902 -1% EBITDA 781 -26 +3 -17 +52 +46 839 +7% Operating Profit 386 -16 -3 -14 +52 +73 478 +24% EBITDA/sales 11.2% 12.2% Op.
Slide 40: Europe Lightside
Europe Lightside Analysis of change € million 20161 Exchange Acquisitions Organic 2017 % Change Sales revenue 1,392 -15 +7 +56 1,440 +3% EBITDA 137 -2 +1 +7 143 +4% Operating Profit 92 -2 +1 +11 102 +11% EBITDA/sales 9.8% 9.9% Op. profit/sales 6.6% 7.1% 1 CRH’s landscaping businesses in Europe, form
Slide 41: Europe Distribution
Europe Distribution Analysis of change Pension € million 2016 Exchange Acquisitions Organic 2017 % Change credit1 Sales revenue 4,066 -20 +28 - +71 4,145 +2% EBITDA 206 -1 - +61 +3 269 +31% Operating Profit 130 -1 - +61 +17 207 +59% EBITDA/sales 5.1% 6.5% Op. profit/sales 3.2% 5.0% 1 Swiss pension p
Slide 42: Asia
Asia Analysis of change € million 2016 Exchange LH costs1 Organic 2017 % Change Sales revenue 508 -39 - -33 436 -14% EBITDA 109 -11 +6 -52 52 -52% Operating Profit 71 -7 +6 -55 15 -79% EBITDA/sales 21.5% 11.9% Op. profit/sales 14.0% 3.4% 1 LH integration costs of €6 million were incurred in 2016. CR
Slide 43: Cement Volumes & Pricing
Cement Volumes & Pricing YoY % Change Volumes Price (LC) YoY % Change Volumes Price (LC) Finland ++ - Slovakia ++ = France ++ = Spain ++ + Germany - = Switzerland -- = Legend >5% ++ Hungary ++ + Ukraine -- ++ 2% to 5% + Ireland + - United Kingdom - = -1% to +1% = -5% to -2% - Poland ++ - Canada + =
Slide 44: Americas Materials Volumes & Prices
Americas Materials Volumes & Prices Total Heritage YoY % Change Volumes Price Volumes Price Aggregates +7% +5% 0% +6% Asphalt +6% +2% +2% +3% RMC +3% +3% +4% +3% CRH plc, Preliminary Results 2017 43
Slide 45: 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 46: 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 The inclusion of CRH public limited company in any MSCI Index, and the use of MSCI logos, trademarks, service marks or index names
Slide 47: CRH plc Registered Office
Cover Image: Fels’ Elbingerode Quarry in Saxony-Anhalt, Germany. CRH acquired Fels, a leading German lime and aggregates business, with nine production locations in Germany and one each in the Czech Republic and in the Moscow region of Russia, for €0.6 billion in 2017. CRH plc Registered Office Belg