CRH PLC · NYSE:CRH
CRH — Davy European Conference 2009
38 slides from CRH's conference presentation, Sep 9, 2009
Slide 1: Davy European Conference, New York, 9th September 2009
Davy European Conference, New York, 9th th September 2009 Myles Lee Chief Executive Officer CRH plc, Davy European Conference, 9th September 2009 1
Slide 2: Agenda
Agenda 1 CRH Overview 2 CRH in North America 3 H1 2009 Trading, Outlook & Summary CRH plc, Davy European Conference, 9th September 2009 2
Slide 3: CRH Overview
CRH Overview The International Building Materials Group 1970: merger of Irish Cement and Roadstone; Sales €26M, 95% Ireland Now: 35 countries; 3,700+ locations; 80k people; 2008 Sales €20+Bn Evenly balanced across geographies, products and sector end-use Market Cap c.€12Bn, a building materials
Slide 4: CRH … A Leading Player in the Building Materials Sector worldwide
CRH … A Leading Player in the Building Materials Sector worldwide 40.0 35.0 Market Cap Debt 30.0 53% 25.0 47% 45% €Bn 20.0 68% 15.0 27% 72% 10.0 46% 5.0 33% 64% 27% 54% 0.0 Lafarge St Gobain Holcim CRH Cemex Wolseley Heidelberg Vulcan Martin Italcementi W'berger Marietta No. No. 44 by by Market Mark
Slide 5: CRH … A Leading Player in the Building Materials Sector worldwide
CRH … A Leading Player in the Building Materials Sector worldwide 40.0 35.0 Market Cap Debt 30.0 53% 25.0 47% 45% €Bn 20.0 68% 15.0 27% 72% 10.0 46% 5.0 33% 64% 27% 54% 0.0 Lafarge St Gobain Holcim CRH Cemex Wolseley Heidelberg Vulcan Martin Italcementi W'berger Marietta No. No. 44 in in terms terms
Slide 6: CRH... A Balanced Portfolio
CRH... A Balanced Portfolio Providing Building Materials for Our World Materials Products Products Distribution The Fundamentals Constructing Completing Fit-Out the Frame the Envelope and Renewal ¾Aggregates ¾Precast Concrete ¾Clay ¾Builders ¾Cement ¾Architectural ¾Glass Merchants ¾Roofing & Concret
Slide 7: CRH … Broad-based Exposure
CRH … Broad-based Exposure International and Balanced By Geography North Western Emerging America Europe Regions 45% 40% 15% By Product Heavyside 75% Lightside 25% Materials Concrete Other Distribution Products Products 60% 15% 10% 15% By Sector Residential Non-Residential Infrastructure 35% 35% 30%
Slide 8: Agenda
Agenda 1 CRH Overview 2 CRH in North America 3 H1 2009 Trading, Outlook & Summary CRH plc, Davy European Conference, 9th September 2009 8
Slide 9: CRH in North America
CRH in North America The largest integrated Building Materials Group 1978 – First Step Acquired Amcor a Utah-based concrete products manufacturer Today In Materials, Products & Distribution In all 50 States & 4 Canadian Provinces 2008 Results: Residential Non- Non-Residential Infrastructure Infra
Slide 10: Americas Materials
Americas Materials #1 Asphalt and a Top 3 Aggregates player Industry Comparisons: CRH* VMC MLM Aggregates (m tons) 165.1 204.3 155.6 Asphalt (m tons) 50.1 9.5 n/a RMC (m yd3) 10.5 6.4 n/a Reserves (Bn tons) 11 13.5 10 2008 Results: Sales $7.4Bn Op. Profit $0.7Bn Avg Net Assets $6.4Bn Res Non- Non-Re
Slide 11: Americas Materials
Americas Materials Structured to service US Infrastructure demand Current underlying SAFETEA-LU funding for US Infra c$80Bn p.a. Funded 45:55 from Federal Programmes and State/Local budgets Supported by: Federal and State gasoline taxes Vehicle excise duties and registration fees Bond Revenues Am
Slide 12: Americas – Infrastructure Sector
Americas – Infrastructure Sector What ARRA means for Highways & Bridges – US$27.5Bn Airports / Mass Transit $8.4 Ports / Coast Estimated timing of $27.5Bn spend Guard ¾’09 $2.6 Discretionary c$ 6Bn $1.5 Rail ¾’10 c$12Bn $9.3 ¾’11 c$ 8Bn Highways / ¾’12 c$ 2Bn Bridges $27.5 $18.1Bn obligated to 31
Slide 13: Americas – Infrastructure Sector
Americas – Infrastructure Sector Federal Funding programmes 90 90 SAFETEA-LU 80 80 ($286.5Bn) expires 70 70 30 Sep ‘09 60 60 House T&I C’tee 50 50 proposes $337Bn 4.0% (+48%) Federal 40 CAGR 40 8.0% Funding for CAGR 30 30 highways over 6 yrs CAGR 3.8% 20 20 18 mth extension 10 10 likely if long-
Slide 14: Americas Products
Americas Products #1 Concrete Products; #1 Glass & Aluminum Glazing Systems Business areas: ¾Arch. Concrete Products ¾Precast Concrete Products ¾Glass Fabrication ¾Engineered Glazing Systems ¾Construction Accessories 2008 Results*: Residential Non- Non-Residential Infra Infra Sales $ 4.8Bn 30% 60% 1
Slide 15: Americas Products – APG
Americas Products – APG National leader in Architectural Concrete Products – ’08 Sales $1.9Bn No.1 Concrete Masonry, Patio Products, Rooftiles No.2 Prepackaged Concrete Mixes Residential Non- Non-Residential Infra 60% 35% 5% No.1 Clay Brick n/east & m/west US New RMI RMI 40% 60% 60% CRH plc, Davy Eu
Slide 16: Americas Products – Precast
Americas Products – Precast National leader in Precast Concrete Products – ’08 Sales 0.8Bn No.1 – Precast Concrete Utility Vaults Modular Building Residential Non- Non-Residential Infra Infra 40% 35% 25% 25% Concrete Pipe New RMI RMI 85% 15% 15% Telecom Enclosures CRH plc, Davy European Conference,
Slide 17: Americas Products – Glass
Americas Products – Glass National leader in Building Envelope Systems – ’08 Sales 1.2Bn No.1 Architectural Glass Fabrication No.1 US Engineered Aluminum Glazing Systems Residential Non- Non-Residential Non-Residential 5% 95% 95% New RMI RMI 80% 20% 20% CRH plc, Davy European Conference, 9th Septemb
Slide 18: Americas Products – MMI
Americas Products – MMI Construction Accessories, Wire & Fencing Products – ’08 Sales 0.7Bn No.2 Construction Accessories No.1 Welded Wire Reinforcement No.1 Fencing distributor & Residential 15% Non- Non-Residential 50% Infra Infra 35% manufacturer 35% New RMI RMI 85% 15% 15% CRH plc, Davy European
Slide 19: Americas Products – Distribution
Americas Products – Distribution #4 Exterior Products & #3 Interior Products – ‘08 Sales $2.1Bn Exterior: Roofing, Siding & related products Interior: Wallboard, steel studs, insulation etc. Industry Comparisons: CRH Industry Exterior States 26 35 Products Branches c139 c170 (vs. Beacon 2008 Sales $
Slide 20: Americas – Residential Sector
Americas – Residential Sector Indication of recovery commencing 2010 Starts 000's Housing Starts 1970 - 2014e population 2008 m 3,000 360 2,500 300 2,000 240 1,500 180 1,000 120 500 60 0 0 1970 1975 1980 1985 1990 1995 2000 2005 2010e Population Multi Family Starts Single Family Starts Total Starts
Slide 21: Americas – Non Residential Sector
Americas – Non Residential Sector Indication of Non-Res recovery to lag Res by c12-24 mths US$ Bn Non-Residential v. Residential 1970 - 2014e 2008 350 300 250 200 150 100 50 1970 1975 1980 1985 1990 1995 2000 2005 2010e Non-Residential Residential(new) Source: 1970 – 2006 Dodge 2007 – 2014 PCA, Augu
Slide 22: Americas – Non Residential Sector
Americas – Non Residential Sector ABI improving from Jan 2009 low ABI Index 50 = Neutral ABI = Architectural Billings Index 2000 - 2009 Jan 2009 70 60 50 40 30 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Source: US ABI 2000 – Jul 2009 ABI ABI considered considered to to be
Slide 23: H1 2009 – Americas Performance
H1 2009 – Americas Performance Impacted by poor weather and rapid Non-Res fall-off Americas Americas Americas Americas Total Materials Products Distribution $m H1‘09 H1’08 H1‘09 H1’08 H1‘09 H1’08 H1‘09 H1’08 Sales 4,902 6,400 2,196 2,868 1,923 2,542 783 990 EBITDA 321 608 180 242 127 305 15 61 EBITD
Slide 24: 2009 Outlook
2009 Outlook Americas Some indications of stabilisation in US Res; Non-Res fall-off continuing Products & Distribution operations face ongoing challenges in H2 Infra activity continues to gain momentum under Stimulus package Look to a strong full year performance in Materials operations CRH CRH
Slide 25: Summary – CRH in North America
Summary – CRH in North America No. 1 in North America No.1 Building Materials player with strong regional/national positions Prompt response to deteriorating market conditions 2007-2009 Significant cost/cash generation measures implemented Residential Non- Non-Residential Infrastructure Infrastru
Slide 26: Agenda
Agenda 1 CRH Overview 2 CRH in North America 3 H1 2009 Trading, Outlook & Summary CRH plc, Davy European Conference, 9th September 2009 26
Slide 27: H1 2009 Key Points
H1 2009 Key Points Results in line with July IMS guidance Results / Cost Reduction Reported Revenue -15%; EBITDA -41%; Operating Profit -66% PBT €108m after €74m restructuring and €21m adverse FX effects Increased cost savings tempered profit declines Cash Flow / Balance Sheet Traditional H1 Op.
Slide 28: Increased Cost Savings
Increased Cost Savings Announced July 2009 Cumulative annualised 2007 - 2010 Announced Jan-09 Jan-09 Gross Savings of €€895m 895m Updated July-09 July-09 to Gross Savings of €€1,450m 1,450m Total Total annualised annualised savings savings increased increased by by €€555m 555m to to €€1,450m 1,450m
Slide 29: Cost Savings Overview
Cost Savings Overview Announced July 2009 Impact Gross Annualised Initiatives (€m) ‘07 ‘08 ‘09 ‘10 Savings 2007 50 - - - 50 2008 - 447 398 - 845 2009 - - 450 105 555 Gross savings 50 447 848 105 1,450 Cost to implement - 62 158 30 Net savings 50 385 690 75 Implementation Implementation ongoing ongoi
Slide 30: H1 2009 Components of Performance
H1 2009 Components of Performance Cost reduction tempered impact of organic sales decline Op. Profit on Finance Assoc. €m Sales EBITDA Profit Disposals Costs PAT PBT H1 ’08 Reported 9,704 1,104 712 24 (161) 31 606 FX effects 455 11 (11) 1 (10) (1) (21) H1’08 @ ’09 FX rates 10,159 1,115 701 25 (171)
Slide 31: H1 2009 Funds Flow
H1 2009 Funds Flow Cash generation focus delivered strongly in H1 €m H1 H1 12 mths to 2009 2008 June 2009 Inflows Profit before tax 108 606 1,130 Depreciation 388 371 798 Amortisation of intangibles 22 21 44 518 998 1,972 Outflows Working capital (96) (606) 439 Tax Paid (41) (149) (214) Dividends (2
Slide 32: Dividend
Dividend Maintained Interim Dividend Good H1 operating cash flow delivery despite profit decline Expect strong operating cash inflow in seasonally more profitable H2 18.50c Interim dividend; maintains rights adjusted ‘08 Interim of 18.48c Board will decide and announce final dividend decision in
Slide 33: Debt Ratios & Interest Cover
Debt Ratios & Interest Cover Amongst the best in the sector H1 H1 Year-end 2009 2008 2008 Total Net Debt (incl share of JVs) €m 5,122 6,563 6,091 Total Equity €m 9,222 7,546 8,157 Debt/Total Equity 56% 87% 75% Debt/Market Capitalisation 45% 66% 64% Debt/EBITDA* (times) 2.3x 2.3x 2.3x EBITDA Net inte
Slide 34: June 2009 Debt Maturity Profile
June 2009 Debt Maturity Profile No undue concentration of maturities June 2009 CRH Debt € Bn Gross Debt by Maturity Undrawn (incl. Derivatives) (incl. JVs) Committed Facilities O/Ds 0.1 - Within 1 year 0.9 0.5 2 years 0.4 0.4 3 years 1.2 0.7 4 years 0.1 0.1 5 years 1.3 0.1 5 years + 2.2 0.1 Total 6.
Slide 35: 2009 Outlook
2009 Outlook H1 Overview and Recent Economic Indicators H1 Overview Very tough H1 trading but rate of decline eased substantially in Q2 Significant cost reduction measures tempered H1 profit decline With marked reduction in seasonal operating cash outflow Recent Economic Indicators Generally mor
Slide 36: 2009 Outlook
2009 Outlook Overall Overall we expect H1 rate of profit decline to moderate in H2 ….. ….. with benefits from aggressive cost reduction measures and ….. ….. more moderate H2 energy related input costs than in ’08 Continuing focus on commercial delivery & cash generation to ensure… ….. CRH is wel
Slide 37: Summary: CRH Investment Highlights
Summary CRH Investment Highlights Consistent strategy and growth record over c.40 years Disciplined approach to acquisitions through the cycle Geographic, sectoral and product balance a key strength Strong market positions and well located strategic reserves Consistent strong cash flow generati
Slide 38: Contact Us
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 or look up our Website - www.crh.com This presentation contains certain forward-looking statements as defined under US legislation. By their nature, such s