Building materials group CRH has soared to the top of the FTSE 100 this morning after it reported a 41 per cent increase in earnings in 2016, boosted by a full year contribution from the businesses acquired in 2015 from Lafarge which included the Tarmac operation in the UK.
Earnings before interest tax depreciation and amortisation grew from €2.2bn to €3.1bn. Stripping out acquisitions and disposals, earnings were up 10 per cent. Shares are up 2.7 per cent at publication time to £27.98.
Albert Manifold, chief executive, said “2016 was a year of significant growth with margins and returns ahead of last year in every division.”
Sales increased 15 per cent from €23.6bn to €27.1bn.
On an organic basis, sales were up 4 per cent overall – with positive construction markets contributing to 5 per cent growth in the Americas, and 4 per cent in Europe.
After a 8 per cent sales decline in its key heavy materials division in Europe in 2015, the company saw a strong rebound driven by a market recovery in Ireland, Ukraine, Finland and the Netherlands.
The Dublin based company which does 65 per cent of its business in the Americas said it expected “a positive trend in volumes” in the second half of 2017 in the US on the back of expected increases in federal funding for highways and state spending on transport projects, which President Donald Trump made one of his campaign pledges.
With €2.3bn of cash generated in 2016 net debt is now down to 1.7 times EBITDA from 3 times at the end of 2015.
Mr Manifold said the improved cash position “restored capacity to do deals again”.
The company made 13 acquisitions in the Americas and another 8 in Europe in 2016. Since the start of 2017 it has already concluded 8 deals.