CRH PLC · NYSE:CRH
CRH — Citigroup Building Materials Conference 2007
29 slides from CRH's conference presentation, Nov 29, 2007
Slide 1: CRH – Delivering through the Cycle
Citigroup Building Materials Conference CRH – Delivering through the Cycle Liam O’Mahony Chief Executive CRH plc November 2007 1
Slide 2: CRH Overview
CRH Overview 2 ‘en
Slide 3: CRH Overview
CRH Overview The International Building Materials Group 1970 merger of Irish Cement and Roadstone; Sales €26M, 95% Ireland Now in 30 countries; 3,300+ locations; 80,000+ people Annualised Sales over €20Bn focused on three core businesses Evenly balanced across geographies, products and secto
Slide 4: CRH - The International Group
CRH - The International Group In 30 countries and in all 50 US States Developed Developed world world focus; focus; increasing increasing presence presence in in emerging emerging regions regions Citigroup Building Materials Conference, 29th November 2007 4
Slide 5: CRH - The Building Materials Group
CRH - The Building Materials Group Leading positions in local / regional markets Materials Materials Products Products Distribution Distribution Concrete Concrete Other Other Europe Europe Europe Europe Europe Europe Europe Europe Top Top10 10Cement Cement No No11Architectural Architectural No No11A
Slide 6: CRH - Servicing the Breadth of Demand
CRH - Servicing the Breadth of Demand Balanced exposure to industry demand drivers Product End Use* Geographic End-Use* Materials Products Americas 55% 33% 50% Distribution 12% Europe 50% Sectoral End Use* Residential Non Residential New 40% 30% 55% Infrastructure RMI 30% 45% Balance Balance yields
Slide 7: CRH - Track Record
CRH - Track Record A strong culture of delivering superior Performance & Growth 75,000 PBT +20%pa 60,000 Growth Index [1970 = 100] 45,000 30,000 EPS +17%pa 15,000 DPS +12%pa 0 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 20% 20% CAGR CAGR in in Total Total Shareholder Shareholder Return Return
Slide 8: Delivering Through the Cycle
Delivering Through the Cycle 8
Slide 9: Recent Economic Cycles
Recent Economic Cycles Western Europe & US GDP growth 1990 - 2006 GDP Growth 5% W Europe GDP US GDP 4% 3% 2% 1% 0% Source: IMF (1% ) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Citigroup Building Materials Conference, 29th November 2007 9
Slide 10: Recent Economic Cycles
Recent Economic Cycles Building materials demand linked to economic cycles GDP EPS (c) Growth (pre GW) 5% W Europe GDP US GDP CRH EPS 250 4% 200 3% 150 2% 100 1% 50 0% 0 Source: IMF (1% ) (50) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 CRH CRH -- delivering
Slide 11: Period I: 1990 – 1995 Economic Backdrop
Period I: 1990 – 1995 Economic Backdrop Worldwide Recession W Europe GDP US GDP 5% Gulf War 4% High energy prices 3% 2% Sharp US decline & recovery 1% Europe lagged with slower decline 0% (1% ) GDP growth stalled US & Europe 1990 1991 1992 1993 1994 1995 Citigroup Building Materials Confer
Slide 12: Period I: 1990 – 1995 CRH Performance
Period I: 1990 – 1995 CRH Performance EPS (c) (pre GW) Strong Cashflow through downturn EBITDA Margin CRH EPS 14% 50 12% Rapid EBITDA margin recovery 40 10% 8% 30 Benefits of operational leverage 6% 20 4% 10 Pursuit of new opportunities 2% 0% 0 1990 1991 1992 1993 1994 1995 Sales from €1.7
Slide 13: Period I: Acquisition Spend and Expansion of P&D
Period I: 1990 – 1995 Acquisition Spend c€0.6Bn … Expansion of P&D EBITDA EBITDA Group EBITDA growth c60% € 0.3Bn 1990 1995 € 0.2Bn Ireland 43% 32% Americas Benelux Europe 36% 35% Rest of Europe Ireland Americas 21% 33% 1990 1995 Materials 64% 49% Distribution Products 23% 37% Products
Slide 14: Period II: 1995 - 2000
Period II: 1995 - 2000 Period of strong economic growth in US and Europe GDP EPS (c) Growth (pre GW) 5% W Europe GDP US GDP CRH EPS 250 4% 200 3% 150 2% 100 1% 50 0% 0 Source: IMF (1% ) (50) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 CRH CRH accelerated acce
Slide 15: Period II: 1995 – 2000 Economic Backdrop
Period II: 1995 – 2000 Economic Backdrop Favourable Economies W Europe GDP US GDP 5% Lower energy prices 4% Stronger USD [1€ = 1.26 to 0.92] 3% 2% Strong US growth c4% p.a. 1% Lower Europe growth c3% p.a. 0% 1995 1996 1997 1998 1999 2000 Citigroup Building Materials Conference, 29th November
Slide 16: Period II: 1995 – 2000 CRH Performance
Period II: 1995 – 2000 CRH Performance EPS (c) (pre GW) EBITDA Margin CRH EPS Rapid expansion on all fronts 16% 140 14% 120 12% Strong & rising EBITDA margins 100 10% 80 8% 60 Underpinned by growing Cashflow 6% 40 4% 2% 20 Sales from €2.5Bn to €8.9Bn 0% 0 1995 1996 1997 1998 1999 2000 EPS EP
Slide 17: Period II: Acquisition Spend c€3Bn
Period II: 1995 – 2000 Acquisition Spend c€3Bn … 55:45 Americas:Europe EBITDA EBITDA EBITDA growth over 300% € 1.3Bn Rapid US expansion + stronger $ 1995 2000 Americas Ireland 32% 14% Benelux € 0.3Bn Rest of Europe Europe 35% 26% Ireland Americas 33% 60% 1995 2000 Materials 49% 57% Distr
Slide 18: Period III: 2000 - 2006
Period III: 2000 - 2006 Worldwide slowdown post Dot.Com crash and 9/11 GDP EPS (c) Growth (pre GW) 5% W Europe GDP US GDP CRH EPS 250 4% 200 3% 150 2% 100 1% 50 0% 0 Source: IMF (1% ) (50) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 CRH CRH maintained maintai
Slide 19: Period III: 2000 – 2006 Economic Backdrop
Period III: 2000 – 2006 Economic Backdrop Worldwide Slowdown W Europe GDP US GDP 4% Dot.Com bust and 9/11 tragedy 3% Weaker USD [1€ = 0.92 – 1.26] 2% Again sharp US decline/recovery 1% Europe followed – slower pick-up 0% However; neither economy stalled 2000 2001 2002 2003 2004 2005 2006 C
Slide 20: Period III: 2000 – 2006 CRH Performance
Period III: 2000 – 2006 CRH Performance EPS (c) (pre GW) US Non Res particularly affected EBITDA Margin CRH EPS 16% 250 Rapid recovery; strong Res/Infra 12% 200 150 EBITDA margins 12-14% range 8% 100 Significant development activity 4% 50 0% 0 Sales from €8.9Bn to €18.7Bn 2000 2001 2002 20
Slide 21: Period III: Acquisition Spend c€9.6Bn
Period III: 2000 – 2006 Acquisition Spend c€9.6Bn … 57:43 Americas:Europe EBITDA EBITDA EBITDA growth c100% € 2.5Bn Eastern Europe expansion 2000 2006 € 1.3Bn Americas Ireland 14% 8% Benelux Rest of Europe Europe 26% 38% Ireland Americas 60% 54% 2000 2006 Materials 57% 51% Distribution
Slide 22: Looking Ahead 2005 – 2010
Looking Ahead 2005 – 2010 Economic outlook uncertainty – range of views Current GDP Forecasts W Europe GDP US GDP 4% Some see risk of US recession 3% Mean forecasts … Fed High Euroconstruct … Not as bleak as early ‘90s / ’00s 2% Fed Low … Not negative growth 1% Fed/ECB important roles to play
Slide 23: CRH 1990 - 2006
CRH 1990 - 2006 Strong delivery of Performance and Growth EBITDA EPS (c) Margin (pre GW) 16% EBITDA Margin CRH EPS 250 14% 200 12% 150 10% 8% 100 6% 50 4% 0 2% 0% -50 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1993 1993 –– 2006 2006 … … 14 14 consecutive con
Slide 24: CRH Today
CRH Today 24
Slide 25: CRH in 2007: A Leading International Building Materials Group
CRH in 2007 A Leading International Building Materials Group Aggregates ............... Top 5 worldwide with c13Bn tonnes reserves Cement ..................... Top 10 in Europe Readymix ................. Top 5 worldwide Concrete Products … No. 1 in US and Europe Construction Accessories ..
Slide 26: CRH in 2007: Group operating characteristics
CRH in 2007 Group operating characteristics Developed world focus … 85-90% of annualised EBITDA (c20 countries) Increasing presence in emerging regions ... 10-15% EBITDA (c10 countries) Vertically integrated materials business Complemented by value-added products & distribution Robust cash
Slide 27: CRH Strengths
CRH Strengths In our 15th consecutive year of earnings growth Diverse yet balanced geographic, sectoral and product end-use Experience of managing through economic cycles Devolved structure supports ability to respond promptly Focus on cost control, operational efficiency, margins and cashfl
Slide 28: Conclusion
Conclusion A culture and track record of delivery Relentless focus on operational performance Disciplined approach to acquisition evaluation Focussed integration with emphasis on value-creation Dedicated people with ambition to achieve … enables CRH to deliver Superior Performance and Growth
Slide 29: CRH – Delivering through the Cycle
Citigroup Building Materials Conference CRH – Delivering through the Cycle Liam O’Mahony Chief Executive CRH plc November 2007 29