UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13A - 16 OR 15D - 16 OF

THE SECURITIES EXCHANGE ACT OF 1934


01 March 2017

Commission File No. 001-32846

____________________________



CRH public limited company

(Translation of registrant's name into English)

____________________________

Belgard Castle, Clondalkin,


Dublin 22, Ireland.


(Address of principal executive offices)

____________________________


Indicate by check mark whether the registrant files or will file annual reports

under cover of Form 20-F or Form 40-F:


Form 20-F X Form 40-F___

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by

Regulation S-T Rule 101(b)(1):_________

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by

Regulation S-T Rule 101(b)(7):________

 

 

 

 

 

 

2016 Full Year Results

 

Key Points

●  Continued profit growth

●  Margins and returns ahead in all divisions

●  Strong cash generation; de-leveraging target exceeded and balance sheet restored

●  Dividend increased

 

Trading Highlights

●  Sales of €27.1 billion, 15% ahead of 2015; up 4% on a proforma1 basis

●  EBITDA up 41% to €3.1 billion, ahead of November guidance; proforma EBITDA up 10%

●  EBITDA margin 11.5% up from 9.4% in 2015

●  Cash inflow of €2.3 billion from operating activities

 

Strategic Highlights

●  Return on net assets (RONA1) 9.7% up from 7.6% in 2015

●  Delivering value through capital allocation and reallocation at attractive multiples

●  Year-end net debt reduced by €1.3 billion to €5.3 billion; Net debt/EBITDA is 1.7x

●  Full year dividend per share increased by 4% to 65.0c, covered 2.3 times

 

Year ended 31 December	2016	2015	Reported	Proforma
	€ m	€ m	Change	Change
Sales revenue	27,104	23,635	+15%	+4%
EBITDA	3,130	2,219	+41%	+10%
EBITDA Margin	11.5%	9.4%	+210bps	+60bps
Operating profit (EBIT)	2,027	1,277	+59%
Profit before tax	1,741	1,033	+69%
	€ cent	€ cent
Basic earnings per share	150.2	89.1	+69%
Dividend per share	65.0	62.5	+4%

 

 

Albert Manifold, Chief Executive, said today:

"2016 was a year of significant profit growth for CRH, with margins and returns ahead of last year in every division. We benefited from positive momentum in the Americas, and also in Europe, particularly in the Northern and Eastern regions where we operate. The focus on cash management resulted in our year-end debt metrics being ahead of target and below normalised levels. In addition to organic growth, we continue to develop CRH through acquisitions, having completed eight transactions already this year. With our balanced portfolio of businesses, CRH is well positioned to capitalise on the ongoing economic recovery and we see continued growth for the Group in 2017."

 

Announced Wednesday, 1 March 2017

 

1See pages 30 to 33 for glossary of alternative performance measures (including proforma and RONA) used throughout this report.

 

 

2016 Full Year Results

Overview

The overall trading backdrop in 2016 was positive with momentum in both the Americas and Europe, albeit at different paces, supported by a good performance from our newly established Asia Division. This was augmented by favourable weather patterns across most of our key markets in the Americas at the start of the year. With a relentless focus on performance in all our businesses, coupled with our vertically integrated business model for heavyside materials, our good operational leverage underpinned an improvement in both margins and returns.

 

Sales of €27.1 billion for the period were 15% ahead of 2015 reflecting the inclusion of full year results from the LH Assets and C.R. Laurence ("CRL") acquisitions which were completed in the third quarter of 2015. On a proforma basis (at constant currency, including full year 2015 trading of the LH Assets and CRL acquisitions and excluding all divested entities and certain one-off items - see pages 28 and 29) sales increased 4% due to the positive backdrop in the Group's major markets. A proforma increase of 5% in the Americas, reflecting favourable early weather with more normalised demand patterns experienced in the second half, was due to the continued positive construction markets supported by low interest rates and increasing employment. Proforma sales in Europe were 4% ahead of 2015 on the back of continued recovery in some key markets. The Asia Division reflects results from the Philippines operations acquired in the second half of 2015 as part of the LH Assets, together with CRH Asia's divisional costs. In the Philippines, proforma sales increased 1% as construction demand continued to be supported by good economic growth, strong domestic consumption and low inflation. For 2016 as a whole, higher sales and good cost control supported improved profits and margins across the Group with proforma EBITDA in the Americas 15% ahead of 2015, Europe up 3% and Asia in line.

 

Depreciation and amortisation charges in 2016 amounted to €1.08 billion (2015: €898 million). In addition, an impairment charge of €23 million was recognised in 2016 in respect of the carrying value of intangible assets.

 

Divestments and asset disposals during the year generated total profit on disposals of  €55 million (2015: €101 million) as the ongoing recycling of capital continues to be embedded in the business.

 

The Group's €42 million share of profits from equity accounted entities was slightly lower than 2015 reflecting the full year impact of 2015 divestments partly offset by improved results in certain markets.

 

After net finance costs of €383 million (2015: €389 million), the Group reported profit before tax of  €1.74 billion in 2016 (2015: €1,033 million). Earnings per share for the period were 69% higher than last year at 150.2c (2015: 89.1c).

 

Note 2 on page 17 analyses the key components of 2016 performance.

 

Dividend

CRH's capital allocation policy reflects the Group's strategy of generating industry leading returns through value-accretive investments while delivering long-term dividend growth for shareholders. For the period 1984 to 2009 the Group maintained a progressive dividend policy delivering dividend growth in each of these years. The Group maintained the dividend at 62.5c per share for each of the subsequent six years.

 

An interim 2016 dividend of 18.8c (2015: 18.5c) per share was paid in November 2016. The Board is recommending a final dividend of 46.2c per share (2015: 44.0c). This would give a total dividend of 65.0c for the year, an increase of 4% over last year (2015: 62.5c). The earnings per share for the year were 150.2c representing a cover of 2.3 times the proposed dividend for the year.

 

It is proposed to pay the final dividend on 5 May 2017 to shareholders registered at the close of business on 10 March 2017. A scrip dividend alternative will be offered to shareholders.

 

While the Board continues to believe that a progressive dividend policy is appropriate for the Group, our target is to build dividend cover to 3 times over the medium-term, and accordingly any dividend increases in coming years will lag increases in earnings per share.

 

Major Acquisition Synergies

On announcing the two major acquisitions in 2015, the Group outlined detailed multi-year synergy targets for both. For the LH Assets the original target was €90 million over three years, this estimate was subsequently raised in March 2016 to €120 million, while the target for CRL was US$40 million over two years. Due to the acceleration of initiatives, total synergies achieved in 2016 amounted to €89 million, with €71 million attributable to the LH Assets, while a further €18 million was achieved from the integration of CRL with our existing Oldcastle BuildingEnvelope® business. The Group remains committed to maximising the synergies from the two acquisitions and expects to exceed the targets for both.

 

Finance

Total net finance costs of €383 million were broadly similar to last year (2015: €389 million) as the cost of the higher average debt during this year was offset by the non-recurrence in 2016 of a one-off charge of €38 million in 2015 for the early redemption of a portion of US dollar bonds. Finance costs included discount unwinding and pension-related financial expenses of €66 million (2015: €56 million). Excluding these non-cash expenses and the one-off charge in 2015, net debt-related interest amounted to €317 million (2015: €295 million).

 

The tax charge of €471 million for the year (2015: €304 million) equated to an effective tax rate (tax charge as a % of pre-tax profit) of 27.1%, compared with 29.4% in 2015. The 2015 effective tax rate was influenced by one-off charges related to the LH Assets transaction that were substantially non tax deductible; excluding these, the underlying effective tax rate for 2015 was 25.8%.

Reflecting our relentless focus on cash management, the Group generated net cash flow from operating activities of €2.3 billion for the year (2015: €2.2 billion). Year-end net debt of €5.3 billion was below the guidance provided in November and was €1.3 billion lower than year-end 2015, benefiting from the strong inflows from operations, disciplined capital expenditure and the use of disposal proceeds to fund acquisition spend. Net debt to EBITDA was 1.7x (2015: 3.0x) and, based on net debt-related interest costs, EBITDA net interest cover for 2016 was 9.9x (2015: 7.5x).

 

The Group successfully completed one eurobond issue in 2016, raising €600 million in October through the issue of a 12-year bond with a coupon of 1.375%, our longest tenor in the Eurobond market and an historical low rate for the Group. Proceeds from the bond were partly used to repay the remaining bank term loan financing put in place to fund the purchase of the LH Assets. The bond issue reflects CRH's commitment to prudent management of our debt and the timing of the related maturities and also to maintaining an investment grade credit rating.

 

The Group ended 2016 with total liquidity of €5.5 billion comprising almost €2.5 billion of cash and cash equivalents on hand and €3.0 billion of undrawn committed facilities, €2.7 billion of which do not mature until 2021. At year-end the cash balances were enough to meet all maturing debt obligations for the next 4.3 years and the weighted average maturity of the remaining term debt was 10.1 years.

 

Capital Efficiency

During 2016, the Group completed 21 bolt-on acquisitions and three investment transactions for a total spend of €213 million (including deferred and contingent consideration in respect of prior year acquisitions). On the divestment front, the Group completed 13 transactions and realised total business and asset disposal proceeds of €283 million.

 

2016 Acquisitions

In Europe, eight acquisitions and two investments with a total spend of c.€43 million were completed. Our Heavyside business acquired 11 readymixed concrete plants in the United Kingdom (UK), three quarries in Ireland, an aggregates terminal in Belgium and entered into a sand & gravel joint venture in France, adding reserves of 11 million tonnes. Further investments were also made to buy-out a minority position in Spain and add to an existing joint venture in Ireland. Our Lightside Division completed two acquisitions in the UK: a supplier of composite products, which is highly complementary to our Network Access Products business, and a strategic bolt-on to our UK shutters business. The Distribution Division acquired a small builders merchant in Austria.

 

In the Americas, c.€170 million was spent on 13 acquisitions and one investment. Our Materials Division completed eight bolt-on acquisitions and one investment in 2016. The principal acquisition was of a significant aggregates and asphalt operation in Utah. Seven further bolt-on acquisitions in New Mexico, New Jersey, Michigan, Ohio, Washington and Canada were completed. In total 93 million tonnes of permitted reserves were added during the year. The Products Division completed five acquisitions, the largest of which was of a Canadian exterior surfaces company which is a strong addition to the core hardscape business of our Architectural Products Group (APG). Three precast bolt-on operations were acquired in Colorado, Louisiana and California. Finally, a glass hardware company was added in Perth, Australia, which will significantly enhance our CRL operations in Western Australia.

 

2016 Divestments and disposals

Business divestments during the year generated net proceeds of €123 million. In Europe, our Distribution Division disposed of a roofing products company in the Netherlands while the Heavyside business divested a precast concrete operation in Poland, a small aggregates business in Switzerland and a roof tile operation in Romania. Two small joint venture holdings in France and Germany were also divested. The Americas Materials Division disposed of select aggregates and asphalt operations in Missouri, a small waterproofing business in Michigan and a readymixed concrete operation in Iowa/Minnesota. Certain aggregates assets in Oregon/Montana were also disposed in a cash neutral swap. Finally, our Americas Products Division disposed of a pavement products operation in North Carolina, certain precast operations in Canada and the assets of a burial vaults business. In addition to these business divestments, the Group realised proceeds of €160 million from the disposal of surplus property, plant and equipment.

 

Outlook

In 2017, we see continued positive momentum in the United States (US) construction sector. We expect that residential construction, which has still not returned to long-term average levels, will advance, while non-residential activity will also improve. For US infrastructure, we anticipate that the funding stability provided by the FAST Act (which authorises moderate year-on-year increases in federal funding for highways), together with expected increases in state spending on transportation improvements, will result in a positive trend for volumes, particularly in the second half of the year. Overall we expect our Americas business to advance further in 2017.

 

In Europe, we anticipate that most countries will continue to experience the modest impact of early-stage economic recovery. While the UK's vote to leave the European Union, together with the forthcoming elections in a number of countries, has created a level of uncertainty for the medium-term, we expect progress to continue in 2017.

 

In Asia, we expect further improvement in economic and construction activity in the Philippines in 2017.

 

We expect the generally positive economic backdrop to continue this year. With our balanced portfolio, CRH is well positioned to capitalise on this improved market environment and we see continued growth for the Group in 2017.

 

 

 

Europe Heavyside

 

		Analysis of change
€ million	2015	Exchange	Acquisitions	Divestments	LH Costs	Organic	2016	% change
Sales revenue	5,256	-228	+2,129	-111	-	+350	7,396	+41%
EBITDA	460	-21	+299	-11	+89	-2	814	+77%
Operating profit	135	-8	+183	-7	+89	+5	397	+194%
EBITDA/sales	8.8%						11.0%
Operating profit/sales	2.6%						5.4%
LH integration costs of €32 million were incurred in 2016 (2015: €121 million)

 

Trends remained mixed across our major European markets in 2016 with more challenging conditions in our businesses in Switzerland and Poland contrasted by evident market recovery in Ireland, Ukraine, Finland and the Netherlands. Sales and operating profit were well ahead of 2015, reflecting stable results in our heritage businesses and a full year's trading and synergy benefits of 2015 acquisitions. Organic profit in the heritage businesses was assisted by volume improvements and by ongoing cost saving and efficiency measures which largely offset the impact of a challenging pricing environment in some of our key markets. The segment was organised into six primarily geographical regions at the beginning of 2016, and the commentary below reflects this new organisation.

 

Tarmac (UK)

With a full year of trading included in the results, volumes in our aggregates and readymixed concrete business lines in the UK grew in 2016 against a stable construction backdrop. Price increases were achieved in all products except asphalt where the impact of lower prices was compensated by lower input (bitumen) costs. Despite recent uncertainty surrounding the UK construction market in light of the decision of the electorate in June to exit the European Union, 2016 was a year of progress for Tarmac.

 

UK Cement & Lime, Ireland and Spain

Despite an overall backdrop of modest growth in the cement market, the UK Cement & Lime operations delivered strong volumes and prices in all product categories. Together with the Irish and Spanish cement businesses, the focus on network optimisation resulted in the achievement of synergies in 2016. In Ireland, while cement volumes grew strongly (18%), domestic pricing in particular remained under pressure due to overcapacity in the market. With the benefit of improved cement pricing on exports to the UK, stronger overall volumes and improved domestic concrete and aggregates prices, operating profit was ahead of 2015. In Spain, the macro-economic situation remained weak but stable, with some regional recovery. Prices remained under pressure, and despite some improvement in cement and readymixed concrete volumes, operating profit was lower than last year.

 

France, Benelux and Denmark

Our French cement operations delivered growth in volumes, primarily due to the inclusion of a full year of ownership of the LH Assets, as well as the positive impact of synergies with CRH heritage businesses and a modest recovery in the cement market, although prices remained under pressure due to strong competition and overcapacity. Continued challenging pricing also impacted our precast business in France, although a focus on cost reduction initiatives across the business more than offset the underlying operating profit impact. In the Netherlands, strong recovery of the residential market and an increase in centrally funded infrastructure projects delivered higher volumes in our readymixed and structural concrete operations. Readymixed concrete prices remained under continued pressure. There was some improvement in volumes and prices in Belgium. In Denmark, with the benefit of a strong non-residential market and a year of growth in new residential construction, both volumes and prices in our structural business improved. Sales and operating profit were well ahead of 2015.

 

Switzerland and Germany

Stable economic and construction output combined with an early start to the season in Switzerland led to growth in readymixed concrete volumes. However, cement prices declined against a backdrop of continued pricing pressure arising from imports, and sales and operating profit were below 2015. Strong cement volumes in our German operations reflected a full year of ownership of the LH Assets and growth in construction output, boosted mainly by new build multi-family housing. However, pricing remained under pressure in both our cement and concrete landscaping products businesses.

 

North East

In Poland, weaker than expected activity adversely affected pricing in our cement, readymixed concrete and paving products. Both sales and operating profit were behind prior year due to the significant decline in cement volumes year-on-year. In Finland construction activity recovered strongly in 2016, and all our product categories reported growth in volumes; pricing remained under pressure due to overcapacity in readymixed concrete and increased cement imports. With the benefit of continued cost and efficiency initiatives, overall operating profit was ahead of 2015. Despite the ongoing political conflict, construction activity in Ukraine increased year-on-year and our operations delivered strong trading, and operating profit was ahead of 2015. Cement volumes were up 11%, with prices also increasing during the year. Inflation stabilised somewhat, positively impacting costs and operating profit.

 

South East

After a promising start, 2016 was a mixed year in Romania, and mid-year construction activity slowed as a result of lower government spending and unfavourable weather conditions. Continued strong growth in volumes and prices was delivered by our cement operations in Serbia due to ongoing large motorway projects in the south of the country. Similar to 2015, overcapacity and import pressure remained a threat in the region. Although both Hungary and Slovakia experienced a drop in infrastructure spend, growth was solid in the residential market, with improved cement volumes and prices.

 

 

 

Europe Lightside

 

		Analysis of change
€ million	2015	Exchange	Acquisitions	Divestments	Organic	2016	% change
Sales revenue	961	-28	+30	-50	+28	941	-2%
EBITDA	100	-4	+2	-3	+9	104	+4%
Operating profit	75	-4	+2	-1	+9	81	+8%
EBITDA/sales	10.4%					11.1%
Operating profit/sales	7.8%					8.6%

 

Although reported sales declined 2% driven by exchange and divestments, 2016 was a year of good underlying sales growth for Europe Lightside due to strong performances in key markets combined with some favourable weather patterns in the first-half of the year. Our UK-based businesses continued to benefit from strong activity levels, with a robust residential construction sector in particular. In the Netherlands and France, recovery in construction activity was evident. Swiss market circumstances were challenging, while Germany and Belgium were ahead. Operating profit increased through a combination of growing demand, continuous product innovation, delivery on cost optimisation initiatives and margin expansion activities.

 

Construction Accessories

Like-for-like sales in the Construction Accessories platform grew by 5%, mainly resulting from a combination of continued innovation in key product lines and strong demand in some of our main markets, such as the UK and Germany. While competitive pressure in Switzerland intensified, activity levels in our other European markets and Australia picked up, resulting in strong organic growth across the platform. Our Southeast Asia business recorded a solid performance despite challenging trading conditions. Overall operating profit progressed well, reflecting a combination of organic sales growth and the positive impact arising from internal efficiency improvement initiatives undertaken during the year.

 

Shutters & Awnings

The Shutters & Awnings business recorded flat like-for-like sales in 2016. The German Awnings business saw an increase in sales through a combination of benign weather patterns and the introduction of a number of new products to the market. The German Shutters business delivered a solid performance in relatively flat markets, increasing profitability as a result of the impact of continued performance optimisation measures. The UK business reported a stable organic performance, which was further aided by a complementary acquisition. Despite a decline in like-for-like sales, the Netherlands showed solid profit performance as margins increased in a competitive environment.

 

Perimeter Protection & Network Access Products

The permanent Perimeter Protection business saw a decline in sales, but still showed improvement in performance and continued progress following the restructuring of both its German and UK businesses. Our mobile fencing operation benefited from good demand particularly in its export business with a resultant increase in sales and profitability. Network Access Products, with operations in the UK, Ireland and Australia and a broad export base, recorded an increase in both organic sales and operating profit through positive demand trends in the UK market in particular. Results were also supported by a positive contribution from its newly acquired UK-based business.

 

 

Europe Distribution

 

		Analysis of change
€ million	2015	Exchange	Divestments	Swiss Fine	Organic	2016	% change
Sales revenue	4,158	-24	-53	-	-15	4,066	-2%
EBITDA	171	-1	-2	+32	+6	206	+20%
Operating profit	94	-1	-1	+32	+6	130	+38%
EBITDA/sales	4.1%					5.1%
Operating profit/sales	2.3%					3.2%

 

Europe Distribution was impacted in 2016 by mixed market circumstances in its main geographies, resulting in slightly reduced sales. However, performance improvement initiatives, strong cost control across the Division and the non-recurrence in 2016 of a one-off provision of €32 million in 2015 for a Swiss Competition Commission fine led to an increase in overall profitability. The Netherlands continued to show positive momentum in the new build residential market, while Belgium improved and Germany remained generally stable compared to 2015. The Swiss business faced a challenging market backdrop, with competitive pressures and the impact of new laws on second homes.

 

General Builders Merchants

Overall, like-for-like sales for our General Builders Merchants business declined in 2016 but operating profit remained stable. Challenging market circumstances in the Swiss business, where margin improvements and strong cost control could not fully compensate for lower sales levels, resulted in a decline in profitability. Trading in the Netherlands was strong as a result of increasing overall demand and delivery on performance improvement projects. Sales at our German business were stable in line with market circumstances. Despite a recovering trend in the new residential market, performance in the French business was impacted by unfavourable weather patterns (including flooding) in the Paris area and a competitive market which resulted in a decline in sales and profitability compared to 2015. In Austria, improvements in pricing and product mix, as well as the closure of some branches led to improved results.

               

DIY (Do-It-Yourself)

Our DIY business operates in the Netherlands, Germany and Belgium. Strong competitive pressures resulted in lower sales, but overall operating profit improved. In the Netherlands, DIY is more exposed to the late-cycle RMI market, therefore it did not benefit from an improving new residential market to the same extent as the builders merchants business. Although consumer confidence has improved, competition has also increased, in part due to new entrants. Despite lower sales levels, operating profit increased due to a range of performance improvement measures. The Belgian business suffered from reduced consumer confidence in 2016, leading to lower sales and operating profit. The German DIY business experienced flat sales and profitability, which was in line with market developments.

 

Sanitary, Heating and Plumbing (SHAP)

Sales for our SHAP business were flat compared to 2015, with good progress in Belgium and Germany offset by the challenging market backdrop in Switzerland. Significant cost reductions were realised in Switzerland, which partially compensated for the lower sales. Operating profit in the German and Belgian businesses improved, benefiting from higher sales levels in addition to operational improvements and procurement initiatives.

 

 

 

Americas Materials

 

		Analysis of change
€ million	2015	Exchange	Acquisitions	Divestments	LH Costs	Organic	2016	% change
Sales revenue	7,018	-4	+715	-78	-	-53	7,598	+8%
EBITDA	955	-	+72	-7	+50	+134	1,204	+26%
Operating profit	620	-	+23	-3	+50	+128	818	+32%
EBITDA/sales	13.6%						15.8%
Operating profit/sales	8.8%						10.8%
LH integration costs of €7 million were incurred in 2016 (2015: €57 million)

 

With continuing volume improvement, operational efficiencies and reduced energy costs, Americas Materials had another year of good profit growth in 2016 and delivered a strong organic operating profit. Residential and non-residential demand continued to improve, while publicly funded infrastructure activity remained stable resulting in an overall improvement in trading conditions in the US. Organic sales were down 1% but like-for-like operating profit increased 21%, with positive real price improvements experienced across all products. 2016 also represented the first full year of results from the LH Assets acquired during 2015, which saw mixed regional results from Canada alongside more challenging market conditions in Brazil.

 

Total volumes, including acquisition effects, increased 9% for aggregates, 3% for asphalt and 22% for readymixed concrete. This volume growth, together with a 3% average price increase in aggregates, a 4% average price increase in readymixed concrete in the US and efficient cost control resulted in margin improvements in the year. Despite price declines of 8% in asphalt, strong leverage on increased volumes and the beneficial impact of lower energy prices contributed to margin expansion. Construction sales increased 6%, driven by the Canadian business as bidding continued to be competitive in the US despite limited increased infrastructure spending across some states. Good cost control enabled margin expansion. Demand in our North American cement markets increased as declines in Western Canada were more than offset by increases in Quebec and the US market. Average prices were steady despite strong external downward pricing pressures in the Canadian regions.

 

While the main focus during 2016 was on successfully integrating our Canadian and Brazilian acquired assets, eight bolt-on acquisitions and one investment were also completed in 2016 at a total cost of €112 million. The principal acquisition was of a significant aggregates and asphalt operation in Utah which added three asphalt plants, one readymixed concrete plant and lease rights to 16 aggregates sites. In total 93 million tonnes of permitted reserves were added during the year. Business and asset disposals in 2016 generated proceeds of €107 million, continuing the optimisation of our strategic footprint.

 

United States

Like-for-like aggregates volumes rose 4% from 2015 while average prices increased by 3%. Asphalt volumes increased 1% on a like-for-like basis while input cost decreases more than offset like-for-like price declines of 8% compared to 2015. US readymixed concrete volumes increased 4% compared with 2015 and average prices increased 4%. Like-for-like sales in our paving and construction services business decreased 3%, but this was offset by overall margin expansion of 140 basis points in 2016. Performance was positively impacted by the lower energy cost environment experienced throughout the year.

 

Operations in the US were reorganised at the beginning of  2016 into four divisions; North, South, Central and West. The North division comprises operations in 13 states, the most important of which are Ohio, New York, New Jersey and Michigan. Overall the division's sales were down from 2015; however, with the benefit of operating efficiencies, strong cost controls and lower energy costs, operating profit in the North division improved significantly during 2016. The South division comprises operations in 11 states, with key operations in Florida, North Carolina and West Virginia. Heritage sales in the South division were 1% ahead during 2016, despite record flooding in West Virginia and Kentucky, and the impact of hurricane Matthew. Operating profit was also well ahead in the division with increased volumes contributing to margin growth. The Central division has operations in nine states, with the key states being Texas, Kansas and Arkansas. With resilient market growth in Texas in both the public and private sectors, the Central division delivered a heritage sales increase of 8% along with strong margin improvement. Like-for-like volumes in the division were ahead of 2015, with Texas in particular showing strong growth. The West division has operations in ten states, the most important of which are Utah, Idaho, Washington and Colorado. With strong operating and overhead cost management across each product line, the division reported heritage sales 2% ahead of 2015 along with margin and operating profit increases.

 

Canada

Sales and operating profit were ahead of 2015 with the impact of a full year of ownership of the LH Assets in 2016 augmented by a series of major projects including the Highway 407 extension in Ontario and the Turcot Highway Interchange in Montreal as well as strong backlogs. There were mixed results across different product lines and regions, with improvements in our core markets of Ontario and Quebec partially offset by margin pressures and weaker demand in our Western Canada businesses.

 

Brazil

The construction market weakened in 2016 as a result of deteriorating macroeconomic and political conditions, with overall cement consumption down 12% in the Southeast region and selling prices under continued pressure in a very competitive environment.

 

 

Americas Products

 

		Analysis of change
€ million	2015	Exchange	Acquisitions	Divestments	Organic	2016	% change
Sales revenue	3,862	-48	+390	-214	+290	4,280	+11%
EBITDA	391	-3	+80	-6	+81	543	+39%
Operating profit	249	+2	+58	-1	+103	411	+65%
EBITDA/sales	10.1%					12.7%
Operating profit/sales	6.4%					9.6%

 

Our Products business in the Americas is mainly located in the US and Canada. 2016 saw good progress especially in the first-half, helped by an ongoing pick-up in US macroeconomic fundamentals, including stronger labour markets and good consumer sentiment, which have strengthened private new residential construction and RMI. There was good growth in the South, East Coast and West Coast markets due to an improving non-residential construction sector. Input cost inflation was more than offset by the effects of improved operational efficiencies, procurement initiatives, favourable product mix and targeted price increases. Benefiting from strong acquisition trading results and synergies from the CRL acquisition, as well as good organic growth across the Division, Americas Products achieved a 65% increase in operating profit and margins improved.

 

The acquisition of Techniseal, a manufacturer of packaged products for hardscapes installation, added a product capability complementary to APG's core hardscape business. In addition, four other small bolt-on acquisitions were completed and APG divested its non-core Gemseal business, a manufacturer and supplier of pavement maintenance products, along with two other smaller divestments.

 

Architectural Products (APG)

With the benefit of favourable weather early in 2016, APG showed increased activity in the RMI sector, with continuing improvement from residential and commercial construction. Sales volumes were strong across the US but were more steady in Canada. The favourable selling environment, together with product innovation and commercial initiatives, drove gains across all major product categories and channels resulting in an increase in like-for-like sales compared with 2015. APG focused on both product portfolio management and cost reduction efforts to maximise returns. Overall, APG recorded a strong improvement in operating profit for the year.

 

BuildingEnvelope® (OBE)

In 2016, non-residential building activity experienced increases in both institutional and commercial markets, though contract square footage decreased slightly. Sales growth was driven by favourable glass pricing and product mix, and enhanced production capabilities in architectural glass. These, coupled with actions to differentiate the business through innovative products and technology, enabled OBE to achieve substantial growth in margins and operating profit.

 

Integration of the CRL and OBE businesses has been very successful and both CRL and OBE have continued to benefit from significant synergies through an increased common customer base and fixed cost efficiencies. With a full year of ownership, CRL had strong sales and profit growth and has shown an improvement in margins in 2016.

 

Precast

In 2016, strong sales growth was achieved as specific commercial initiatives continued to deliver, along with improved demand for both private construction and public infrastructure. Operating profit increases were achieved in most markets across all concrete product lines with a particularly strong performance in the West. Overall, like-for-like sales increased, operating profit advanced significantly and backlogs remained strong.

 

 

Americas Distribution

 

		Analysis of change
€ million	2015	Exchange	Organic	2016	% change
Sales revenue	2,229	+5	+81	2,315	+4%
EBITDA	140	-	+10	150	+7%
Operating profit	111	-	+8	119	+7%
EBITDA/sales	6.3%			6.5%
Operating profit/sales	5.0%			5.1%

 

2016 was another year of solid profit delivery on increased sales for our distribution business trading as Allied. Our Exterior Products and Interior Products divisions each advanced and recorded sales and profit growth. Strong demand in the Florida, Chicago and Atlantic markets, focused growth in our Iowa, Ohio and Michigan markets and storm driven demand in Texas were the drivers of performance in our Exterior Products division. Against a strong performance in 2015, sales in our Northeast markets were marginally behind prior year. The Interior Products division continued to experience volume growth throughout the year. The strongest gains were in Western markets, particularly California and Hawaii where increased demand continued to be driven by robust multi-family construction, offsetting softer Carolinas markets.

 

In 2016, Allied management remained highly focused on gross margins in a very competitive environment through improved procurement initiatives, both internal and leveraging the resources of the CRH network. We continued to maintain margin discipline and optimised working capital while growing organically. Technology investments made in 2016 included a customer relationship management tool, a transportation management tracking system and a highly functional mobile application for our customers, all of which serve to differentiate Allied in the marketplace. Our regional service area model continues to mature, and our drive towards simplifying our business processes through continuous improvement all add to the potential for greater economies of scale as our business expands.

 

Although no acquisitions were completed in 2016, the opening of five new locations continued to strengthen our greenfield and service centre strategy. This continued focus allows us to improve in the area of customer service, cost control and more efficiently leveraging existing assets. Sales and product offerings of our Tri-Built private label brand continued to grow in 2016. This, combined with our investments in technology and the ongoing effort and expansion of our service centre network, continue to differentiate Allied in the marketplace.

 

Exterior Products

Commercial roofing continued to experience modest industry-wide growth while growth in the residential sector was largely due to the high level of hail storm activity experienced in specific markets in the US, particularly in Texas. While most of our residential roofing markets grew in line with the market, concentrated efforts resulted in an improved residential product mix. The Exterior Products division reported solid sales and improved operating profits in 2016.

 

Interior Products

Performance in this business was strong in most markets with increased demand of core products contributing to higher sales and operating profit. The strong growth of multi-family construction and a shift towards more urbanisation led to particularly strong results in the Southeast and West Coast markets. Focused investments in new locations and operational excellence initiatives helped to achieve solid sales growth and higher operating margins.

 

 

Asia

 

		Analysis of change
€ million	2015	Exchange	Acquisitions	LH Costs	Organic	2016	% change
Sales revenue	151	-6	+360	-	+3	508	+236%
EBITDA	2	-	+93	+13	+1	109	n/m
Operating profit/(loss)	-7	-	+71	+13	-6	71	n/m
EBITDA/sales	1.3%					21.5%
Operating profit/sales	-4.6%					14.0%
n/m not meaningful percentage movements		LH integration costs of €6 million were incurred in 2016 (2015: €19 million)

 

The Asia Division was formed following the acquisition of the Philippines operations as part of the LH Assets transaction in 2015. The table above includes the results from these operations together with CRH Asia's divisional costs.

 

In addition to our subsidiary businesses in the Philippines, the Group also has a share of profit after tax from our stakes in Yatai Building Materials in China and My Home Industries Limited (MHIL) in India which are reported within the Group's equity accounted investments as part of profit before tax.

 

Philippines

The construction market remains strong in the Philippines, with growth in cement demand in 2016 largely due to increased construction activities in the private sector and government infrastructure spending. Despite competitive markets, operating profit was ahead due to higher selling prices and lower variable costs which benefited from a decrease in the price of imported clinker and lower prices of fuel and power.

 

China and India

Yatai Building Materials continued to be affected by lower volumes and selling prices. Cement prices were down 3% due to lower levels of construction activities and overcapacity in the market.

In 2016, sales at MHIL decreased by 8% due to lower cement prices, increased competition and new capacities in the region. This coupled with lower clinker exports was only partly offset by improved cement volumes, and operating profit was lower in 2016.

 

Primary Financial Statements and Summarised Notes

Year ended 31 December 2016

 

 

Consolidated Income Statement

For the financial year ended 31 December 2016

	2016		2015
	€ m		€ m
Revenue	27,104		23,635
Cost of sales	(18,267)		(16,394)
Gross profit	8,837		7,241
Operating costs	(6,810)		(5,964)
Group operating profit	2,027		1,277
Profit on disposals	55		101
Profit before finance costs	2,082		1,378
Finance costs	(325)		(303)
Finance income	8		8
Other financial expense	(66)		(94)
Share of equity accounted investments' profit	42		44
Profit before tax	1,741		1,033
Income tax expense	(471)		(304)
Group profit for the financial year	1,270		729
Profit attributable to:
Equity holders of the Company	1,243		724
Non-controlling interests	27		5
Group profit for the financial year	1,270		729
Earnings per Ordinary Share
Basic	150.2c		89.1c
Diluted	149.1c		88.7c
Consolidated Statement of Comprehensive Income For the financial year ended 31 December 2016
Group profit for the financial year	1,270		729
Other comprehensive income
Items that may be reclassified to profit or loss in subsequent years:
Currency translation effects	(82)		661
Gains/(losses) relating to cash flow hedges	14		(2)
	(68)		659
Items that will not be reclassified to profit or loss in subsequent years:
Remeasurement of retirement benefit obligations	(61)		203
Tax on items recognised directly within other comprehensive income	3		(30)
	(58)		173
Total other comprehensive income for the financial year	(126)		832
Total comprehensive income for the financial year	1,144		1,561
Attributable to:
Equity holders of the Company	1,128		1,538
Non-controlling interests	16		23
Total comprehensive income for the financial year	1,144		1,561

 

 

Consolidated Balance Sheet

As at 31 December 2016

	2016		2015
	€ m		€ m
ASSETS
Non-current assets
Property, plant and equipment	12,690		13,062
Intangible assets	7,761		7,820
Investments accounted for using the equity method	1,299		1,317
Other financial assets	26		28
Other receivables	212		149
Derivative financial instruments	53		85
Deferred income tax assets	159		149
Total non-current assets	22,200		22,610
Current assets
Inventories	2,939		2,873
Trade and other receivables	3,979		3,977
Current income tax recoverable	4		5
Derivative financial instruments	23		24
Cash and cash equivalents	2,449		2,518
Total current assets	9,394		9,397
Total assets	31,594		32,007
EQUITY
Capital and reserves attributable to the Company's equity holders
Equity share capital	284		281
Preference share capital	1		1
Share premium account	6,237		6,021
Treasury Shares and own shares	(14)		(28)
Other reserves	286		240
Foreign currency translation reserve	629		700
Retained income	6,472		5,800
Capital and reserves attributable to the Company's equity holders	13,895		13,015
Non-controlling interests	548		529
Total equity	14,443		13,544
LIABILITIES
Non-current liabilities
Interest-bearing loans and borrowings	7,515		8,465
Derivative financial instruments	-		5
Deferred income tax liabilities	2,008		2,023
Other payables	461		410
Retirement benefit obligations	591		588
Provisions for liabilities	678		603
Total non-current liabilities	11,253		12,094
Current liabilities
Trade and other payables	4,815		4,761
Current income tax liabilities	394		401
Interest-bearing loans and borrowings	275		756
Derivative financial instruments	32		19
Provisions for liabilities	382		432
Total current liabilities	5,898		6,369
Total liabilities	17,151		18,463
Total equity and liabilities	31,594		32,007

 

 

Consolidated Statement of Changes in Equity

For the financial year ended 31 December 2016

 

	Attributable to the equity holders of the Company
			Treasury		Foreign
	Issued	Share	Shares/		currency		Non-
	share	premium	own	Other	translation	Retained	controlling	Total
	capital	account	shares	reserves	reserve	income	Interests	equity
	€ m	€ m	€ m	€ m	€ m	€ m	€ m	€ m
At 1 January 2016	282	6,021	(28)	240	700	5,800	529	13,544
Group profit for 2016	-	-	-	-	-	1,243	27	1,270
Other comprehensive income	-	-	-	-	(71)	(44)	(11)	(126)
Total comprehensive income	-	-	-	-	(71)	1,199	16	1,144
Issue of share capital (net of expenses)	3	216	-	-	-	-	-	219
Share-based payment expense	-	-	-	46	-	-	-	46
Treasury/own shares reissued	-	-	18	-	-	(18)	-	-
Shares acquired by the Employee Benefit Trust (own shares)	-	-	(4)	-	-	-	-	(4)
Tax relating to share-based payment expense	-	-	-	-	-	12	-	12
Dividends (including shares issued in lieu of dividends)	-	-	-	-	-	(519)	(8)	(527)
Non-controlling interest arising on acquisition of subsidiaries	-	-	-	-	-	-	9	9
Transactions involving non-controlling interests	-	-	-	-	-	(2)	2	-
At 31 December 2016	285	6,237	(14)	286	629	6,472	548	14,443
For the financial year ended 31 December 2015
At 1 January 2015	254	4,324	(76)	213	57	5,405	21	10,198
Group profit for 2015	-	-	-	-	-	724	5	729
Other comprehensive income	-	-	-	-	643	171	18	832
Total comprehensive income	-	-	-	-	643	895	23	1,561
Issue of share capital (net of expenses)	28	1,697	-	-	-	-	-	1,725
Share-based payment expense	-	-	-	27	-	-	-	27
Treasury/own shares reissued	-	-	51	-	-	(51)	-	-
Shares acquired by the Employee Benefit Trust (own shares)	-	-	(3)	-	-	-	-	(3)
Tax relating to share-based payment expense	-	-	-	-	-	5	-	5
Share option exercises	-	-	-	-	-	57	-	57
Dividends (including shares issued in lieu of dividends)	-	-	-	-	-	(511)	(4)	(515)
Non-controlling interest arising on acquisition of subsidiaries	-	-	-	-	-	-	489	489
At 31 December 2015	282	6,021	(28)	240	700	5,800	529	13,544

 

Consolidated Statement of Cash Flows

For the financial year ended 31 December 2016

	2016		2015
	€ m		€ m
Cash flows from operating activities
Profit before tax	1,741		1,033
Finance costs (net)	383		389
Share of equity accounted investments' profit after tax	(42)		(44)
Profit on disposals	(55)		(101)
Group operating profit	2,027		1,277
Depreciation charge	1,009		843
Amortisation of intangible assets	71		55
Impairment charge	23		44
Share-based payment expense	46		27
Other (primarily pension payments)	(65)		(47)
Net movement on working capital and provisions	56		585
Cash generated from operations	3,167		2,784
Interest paid (including finance leases)	(346)		(302)
Corporation tax paid	(481)		(235)
Net cash inflow from operating activities	2,340		2,247
Cash flows from investing activities
Proceeds from disposals (net of cash disposed and deferred proceeds)	283		889
Interest received	8		8
Dividends received from equity accounted investments	40		53
Purchase of property, plant and equipment	(853)		(882)
Acquisition of subsidiaries (net of cash acquired)	(149)		(7,296)
Other investments and advances	(7)		(19)
Deferred and contingent acquisition consideration paid	(57)		(59)
Net cash outflow from investing activities	(735)		(7,306)
Cash flows from financing activities
Proceeds from issue of shares (net)	52		1,593
Proceeds from exercise of share options	-		57
Increase in interest-bearing loans, borrowings and finance leases	600		5,633
Net cash flow arising from derivative financial instruments	(5)		47
Premium paid on early debt redemption	-		(38)
Treasury/own shares purchased	(4)		(3)
Repayment of interest-bearing loans, borrowings and finance leases	(2,015)		(2,744)
Dividends paid to equity holders of the Company	(352)		(379)
Dividends paid to non-controlling interests	(8)		(4)
Net cash (outflow)/inflow from financing activities	(1,732)		4,162
Decrease in cash and cash equivalents	(127)		(897)
Reconciliation of opening to closing cash and cash equivalents
Cash and cash equivalents at 1 January	2,518		3,295
Translation adjustment	58		120
Decrease in cash and cash equivalents	(127)		(897)
Cash and cash equivalents at 31 December	2,449		2,518

 

Supplementary Information

Selected Explanatory Notes to the Consolidated Financial Statements

 

1.   Basis of Preparation and Accounting Policies

 

Basis of Preparation

 

The financial information presented in this report has been prepared in accordance with the Group's accounting policies under International Financial Reporting Standards (IFRS) as adopted by the European Union and as issued by the International Accounting Standards Board (IASB).

 

Certain prior year disclosures have been amended to conform to current year presentation.

 

Adoption of IFRS and International Financial Reporting Interpretations Committee (IFRIC) interpretations

 

The Group has applied those new standards and interpretations that apply from 1 January 2016, including the Annual Improvements 2011-2014 Cycle and amendments to IAS 1 Presentation of Financial Statements. These amendments principally related to clarifications and presentation; and their application did not result in material changes to the Group's Consolidated Financial Statements.

 

Translation of Foreign Currencies

 

The financial information is presented in euro. Results and cash flows of operations based in non-euro countries have been translated into euro at average exchange rates for the year, and the related balance sheets have been translated at the rates of exchange ruling at the balance sheet date. The principal rates used for translation of results, cash flows and balance sheets into euro were:

 

	Average			Year ended 31 December
euro 1 =	2016	2015		2016	2015
Brazilian Real	3.8561	3.7004		3.4305	4.3117
Canadian Dollar	1.4659	1.4186		1.4188	1.5116
Chinese Renminbi	7.3522	6.9733		7.3202	7.0608
Hungarian Forint	311.4379	309.9956		309.8300	315.9800
Indian Rupee	74.3717	71.1956		71.5935	72.0215
Philippine Peso	52.5555	50.5217		52.2680	50.9990
Polish Zloty	4.3632	4.1841		4.4103	4.2639
Pound Sterling	0.8195	0.7258		0.8562	0.7340
Romanian Leu	4.4904	4.4454		4.5390	4.5240
Serbian Dinar	123.1356	120.7168		123.4600	121.5612
Swiss Franc	1.0902	1.0679		1.0739	1.0835
Ukrainian Hryvnia	28.2812	24.3693		28.6043	26.1434
US Dollar	1.1069	1.1095		1.0541	1.0887

 

1.   Basis of Preparation and Accounting Policies - continued

 

Operating Segments

 

During 2016, the Group completed its integration of the businesses acquired from Lafarge S.A. and Holcim Limited in Q3 2015 (the "LH Assets"). In light of this, CRH has revisited its operating segment disclosures to ensure that they continue to reflect the Group's organisational structure and the nature of the financial information reported to and assessed by the Group Chief Executive and Finance Director, who are together determined to fulfil the role of Chief Operating Decision Maker (as defined by IFRS 8 Operating Segments). As a result, a new operating segment for Asia has been identified and activities reported from date of acquisition in Q3 2015 in the LH Assets operating segment have been reallocated within the Europe Heavyside, Americas Materials and new Asia segments.

 

Comparative segment amounts for 2015 have been restated where necessary to reflect the new format for segmentation. The Group now reports across the following seven operating segments:

 

●      Europe Heavyside

●      Europe Lightside

●      Europe Distribution

●      Americas Materials

●      Americas Products

●      Americas Distribution

●      Asia

 

In note 4 beginning on page 18, comparative amounts for full year 2015, and at year-end 2015, have been restated where necessary to reflect the new format of segmentation.

 

2.   Key Components of 2016 Performance

 

€ million	Sales revenue	EBITDA	Operating profit	Profit on disposals	Finance costs (net)	Assoc. and JV PAT	Pre-tax profit
2015	23,635	2,219	1,277	101	(389)	44	1,033
Exchange effects	(333)	(29)	(11)	(7)	3	1	(14)
2015 at 2016 rates	23,302	2,190	1,266	94	(386)	45	1,019
-     Incremental impact in 2016 of:
-     2015/2016 acquisitions	3,624	546	337	-	(33)	2	306
-     2015/2016 divestments	(506)	(29)	(13)	(51)	3	(14)	(75)
-     LH Assets integration costs (i)	-	152	152	-	-	-	152
-     Swiss fine	-	32	32	-	-	-	32
-     Early bond redemption	-	-	-	-	38	-	38
-     Organic	684	239	253	12	(5)	9	269
2016	27,104	3,130	2,027	55	(383)	42	1,741
% Total change	15%	41%	59%				69%

 

(i)    LH Assets integration costs of €45 million were incurred in 2016 (2015: €197 million).

3.   Seasonality

 

Activity in the construction industry is characterised by cyclicality and is dependent to a considerable extent on the seasonal impact of weather in the Group's operating locations, with activity in some markets reduced significantly in winter due to inclement weather. First-half sales accounted for 47% of full-year 2016 (2015: 40%), while EBITDA for the first six months of 2016 represented 36% of the full-year out-turn (2015: 25%).

 

4.   Segment Information

 

		2016			2015
		€ m	%		€ m	%
Revenue
Europe Heavyside		7,396	27.3		5,256	22.3
Europe Lightside		941	3.5		961	4.1
Europe Distribution		4,066	15.0		4,158	17.6
Americas Materials		7,598	28.0		7,018	29.7
Americas Products		4,280	15.8		3,862	16.3
Americas Distribution		2,315	8.5		2,229	9.4
Asia		508	1.9		151	0.6
		27,104	100.0		23,635	100.0
EBITDA
Europe Heavyside		814	26.0		460	20.8
Europe Lightside		104	3.3		100	4.5
Europe Distribution		206	6.6		171	7.7
Americas Materials		1,204	38.5		955	43.0
Americas Products		543	17.3		391	17.6
Americas Distribution		150	4.8		140	6.3
Asia		109	3.5		2	0.1
		3,130	100.0		2,219	100.0
Depreciation, amortisation and impairment
Europe Heavyside		417	37.8		325	34.4
Europe Lightside		23	2.1		25	2.6
Europe Distribution		76	6.9		77	8.2
Americas Materials		386	35.0		335	35.6
Americas Products		132	12.0		142	15.1
Americas Distribution		31	2.8		29	3.1
Asia		38	3.4		9	1.0
		1,103	100.0		942	100.0
Operating profit
Europe Heavyside		397	19.6		135	10.5
Europe Lightside		81	4.0		75	5.9
Europe Distribution		130	6.4		94	7.3
Americas Materials		818	40.3		620	48.6
Americas Products		411	20.3		249	19.5
Americas Distribution		119	5.9		111	8.7
Asia		71	3.5		(7)	(0.5)
		2,027	100.0		1,277	100.0
Profit/(loss) on disposals
Europe Heavyside	24				101
Europe Lightside	1				(23)
Europe Distribution	13				8
Americas Materials	(19)				24
Americas Products	34				(11)
Americas Distribution	2				2
Asia	-				-
	55				101

 

 

 

4.   Segment Information - continued

 

	2016			2015
	€ m			€ m
Reconciliation of Group operating profit to profit before tax:
Group operating profit (analysed on page 18)	2,027			1,277
Profit on disposals	55			101
Profit before finance costs	2,082			1,378
Finance costs less income	(317)			(295)
Other financial expense	(66)			(94)
Share of equity accounted investments' profit	42			44
Profit before tax	1,741			1,033
	2016			2015
	€ m	%		€ m	%
Total assets
Europe Heavyside	8,736	31.7		9,224	33.1
Europe Lightside	731	2.7		767	2.8
Europe Distribution	2,160	7.8		2,238	8.0
Americas Materials	8,970	32.5		8,780	31.5
Americas Products	4,275	15.5		4,146	14.9
Americas Distribution	1,152	4.2		1,095	3.9
Asia	1,557	5.6		1,631	5.8
	27,581	100.0		27,881	100.0
Reconciliation to total assets as reported in the Consolidated Balance Sheet:
Investments accounted for using the equity method	1,299			1,317
Other financial assets	26			28
Derivative financial instruments (current and non-current)	76			109
Income tax assets (current and deferred)	163			154
Cash and cash equivalents	2,449			2,518
Total assets	31,594			32,007
Total liabilities
Europe Heavyside	2,701	39.0		2,773	40.8
Europe Lightside	245	3.5		261	3.8
Europe Distribution	642	9.3		647	9.5
Americas Materials	1,725	24.9		1,582	23.3
Americas Products	998	14.4		952	14.0
Americas Distribution	392	5.7		364	5.4
Asia	224	3.2		215	3.2
	6,927	100.0		6,794	100.0
Reconciliation to total liabilities as reported in the Consolidated Balance Sheet:
Interest-bearing loans and borrowings (current and non-current)	7,790			9,221
Derivative financial instruments (current and non-current)	32			24
Income tax liabilities (current and deferred)	2,402			2,424
Total liabilities	17,151			18,463

 

 

5.   Earnings per Ordinary Share

 

The computation of basic and diluted earnings per Ordinary Share is set out below:

	2016		2015
Numerator computations	€ m		€ m
Group profit for the financial year	1,270		729
Profit attributable to non-controlling interests	(27)		(5)
Numerator for basic and diluted earnings per Ordinary Share	1,243		724
	Number of		Number of
Denominator computations	Shares		Shares
Weighted average number of Ordinary Shares (millions) outstanding for the year	827.8		812.3
Effect of dilutive potential Ordinary Shares (share options) (millions)	6.1		3.6
Denominator for diluted earnings per Ordinary Share (millions)	833.9		815.9
Earnings per Ordinary Share	€ cent		€ cent
- basic	150.2		89.1
- diluted	149.1		88.7