CRH plc, the global building materials group, issues the following Trading Update for the period 1 January 2018 to 30 September 2018.
Nine-month EBITDA €2.5 billion, 8% ahead of 2017; 2% ahead on a like-for-like1 basis
Continued underlying growth in the Americas, despite adverse weather conditions in certain markets. Momentum remained positive in Europe, while demand improved in Asia.
Another year of progress; 2018 EBITDA expected to be approximately €3.35 billion
Based on the momentum we see in our businesses and including the benefit of acquisitions, full-year EBITDA is expected to be approximately €3.35 billion (2017 reported: €3.15 billion). As we look forward to 2019, we expect favourable market fundamentals to continue across our key markets.
Next phase of €1 billion share buyback announced; €700 million completed to date
As part of the 12 month €1 billion share buyback programme announced on 25 April 2018, the Group has, to date, returned €700 million to shareholders through the repurchase of 23.8 million shares across two phases. The Group remains committed to the programme and today announced the next phase.
Continued focus on strong financial discipline; debt metrics maintained
Year-end net debt is expected to be approximately €7 billion, resulting in net debt to EBITDA of circa 2.1x, based on a forecast year-end US dollar/euro exchange rate of 1.14 and including development and buyback activity to date.
Aggressive growth plan in place to 2021; ~€100m of structural cost savings identified
Our plan to deliver 300bps of EBITDA margin improvement and €7 billion of financial capacity by 2021 is progressing as planned and we expect to see early signs of delivery in 2019. As part of this growth plan, we have identified approximately €100 million of structural cost savings, primarily in the areas of overhead reductions, back office rationalisation and the consolidation of certain regional support functions into central and more coordinated hubs.
Cumulative nine-month sales to the end of September amounted to €19.9 billion, an increase of 6% compared with the corresponding period in 2017. On a like-for-like basis, sales were 3% higher than 2017.
On the back of solid underlying market activity, cumulative nine-month like-for-like sales2 were 1% ahead and like-for-like EBITDA was 2% ahead of the same period last year. We expect similar momentum in the final quarter and full-year EBITDA for Europe to be 2% ahead on a like-for-like basis.
In Europe Heavyside, cumulative nine-month like-for-like sales were 4% ahead of 2017 while cumulative like-for-like EBITDA was 2% ahead, reflecting improvements in overall prices and the benefit of performance improvement initiatives, partly offset by input cost increases.