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
20 November 2018
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
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S-T Rule 101(b)(7):________
Enclosure:
Trading Update November
2018
Press Release
Trading
Update - November 2018
CRH
plc, the global building materials group, issues the following
Trading Update for the period 1 January 2018 to 30 September
2018.
Key Highlights
●
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.
Trading Performance
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.
Sales (like-for-like) change versus 2017
|
Europe
|
Americas
|
Asia
|
Group
|
First
half (H1)
|
+1%
|
+3%
|
-2%
|
+2%
|
Quarter
3 (Q3)
|
+2%
|
+5%
|
+13%
|
+4%
|
Nine months to September (9M)
|
+1%2
|
+4%
|
+3%
|
+3%
|
EBITDA
for the nine months to the end of September 2018 was €2.5
billion, an increase of 8% compared with 2017 (€2.3 billion),
reflecting a like-for-like increase of 2%.
EBITDA (like-for-like) change versus 2017
|
Europe
|
Americas
|
Asia
|
Group
|
First
half (H1)
|
+1%
|
+3%
|
-59%
|
+1%
|
Quarter
3 (Q3)
|
+2%
|
+3%
|
0%
|
+3%
|
Nine months to September (9M)
|
+2%
|
+3%
|
-44%
|
+2%
|
Europe Update
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.
Key Markets in Brief
●
UK: cumulative nine-month volumes of cement,
readymixed concrete and aggregates were behind 2017, while asphalt
was ahead; prices increased in cement and aggregates; however,
higher input costs were experienced, particularly in the asphalt
business
●
France: solid price growth across all products and
year-to-date cement volumes were in line with 2017 despite weather
and strike disruption earlier in the year; Q3 cement and readymixed
volumes were well ahead
●
Switzerland: year-to-date cement volumes were ahead against a
backdrop of solid construction demand; pricing pressure continued
in cement and readymixed concrete
●
Benelux: cumulative nine-month volumes and prices in the Netherlands were ahead with continued
growth in the residential sector; higher cement volumes and prices
in Belgium
●
Germany: cement pricing improved and volumes were ahead
excluding the impact of an acquisition-related supply arrangement;
Fels performed in line with expectations
●
Denmark: strong construction demand continued; volumes and
prices were ahead
●
Ireland: volumes in all key products ahead following a
strong Q3; positive pricing trends
●
Poland: volumes and prices ahead in all key products as a
result of strong residential activity and an acceleration in
infrastructure investments
●
Finland: aggregates well ahead benefiting from supply
to a major project, while cement was slightly behind; cement
pricing competitive
●
Ukraine: cement volumes impacted by increased capacity in
the market; prices ahead in a high cost-inflationary
environment
●
South East Europe: cement volumes ahead in North Danube and Serbia,
Romania slightly behind; price progress in all
regions
Europe Lightside like-for-like nine-month sales were 5% ahead of
2017 reflecting good demand in key markets in the Netherlands,
Poland and Australia. Like-for-like EBITDA for the period was also
up 5%, with a solid performance across most platforms despite
increasing input costs.
Key Markets in Brief
●
Construction Accessories: solid
sales progression driven by demand in our western European markets
and robust economic development in core export
markets
●
Architectural Products: positive
underlying market trends in the Netherlands and
Poland
●
Other Lightside businesses: increased sales primarily due to higher volumes in
key markets
In Europe
Distribution, following the
divestment of DIY Benelux in July 2018,
nine-month like-for-like sales2were
1% ahead excluding the change in treatment of certain direct
sales. Like-for-like EBITDA was down 4%, impacted primarily by
continued challenging market conditions in
Switzerland.
Key Markets in Brief
●
Benelux: solid new build residential trends and
performance improvement initiatives positively impacted General
Builders Merchants, offsetting lower activity in Sanitary, Heating
and Plumbing (SHAP) Belgium
●
Switzerland: pressure
on margins continued in a competitive
environment
●
Germany: stable RMI sector with positive market
backdrop in SHAP
Americas Update
Against a backdrop of solid demand and the continuation of
favourable market fundamentals, like-for-like nine-month sales in
our Americas operations were up 4% compared with 2017, while EBITDA
for the period improved by 3% against a backdrop of increasing
input costs. We expect full-year like-for-like EBITDA to be 3%
ahead of 2017.
Key Markets in Brief
●
Residential: continued favourable market conditions in
residential construction activity, both new and
RMI
●
Non-Residential: good
underlying fundamentals, with positive leading indicators in most
segments
●
Infrastructure: underlying growth as federal funding reflects
increased FAST Act allocation with good momentum in state funding
initiatives
In Americas
Materials, volumes in Q3 were
impacted by significant rainfall in the period. Good price
increases across all products resulted in like-for-like nine-month
sales 5% ahead. Over the same period, like-for-like EBITDA was 2%
ahead of last year, as the price increases only partly compensated
for increased input costs and weather disruption.
Key Products in Brief
●
Aggregates: nine-month volumes were 8% ahead of 2017, 1% ahead
on a like-for-like basis, with strong market demand in the South
which was less affected by weather; like-for-like prices were 3%
ahead
●
Asphalt: year-to-date volumes were in line with 2017,
2% behind on a like-for-like basis with weather-related shortfalls
in most regions; backlogs remain strong
●
Readymixed concrete: volumes
for the nine months were 28% ahead of 2017 while like-for-like
volumes were in line; positive pricing was experienced in all
regions
●
Cement: Ash
Grove Cement, with significant operations in the Midwest, Texas and
western US, and our Florida cement acquisitions have performed in
line with expectations; year-to-date volumes in Canada on a
like-for-like basis were 2% behind, impacted by adverse weather
conditions
Americas Products, with
favourable market conditions in all major end-use segments,
experienced sales growth in the third quarter driven by price
increases as volumes were impacted by a competitive market and
unfavourable weather. Like-for-like sales for the first nine months
of 2018 were 2% ahead of last year and like-for-like EBITDA was 6%
ahead of 2017, reflecting improved pricing and continued focus on
commercial and operational initiatives.
Asia Update
Like-for-like sales for the first nine months of 2018 in the
Philippines were 3% ahead of prior year, driven by improved volumes
and prices on the back of stronger demand. Volumes in the third
quarter were strong following a slow start to the year in our key
regions in the Philippines, with cumulative cement volumes 2%
ahead. Cumulative like-for-like EBITDA for the Division was 44%
behind as pricing improvements were offset by higher fuel and power
costs; this trend is expected to continue for the remainder of the
year.
Key Markets in Brief
●
Philippines: increased government spending on
infrastructure and a stable private sector
●
India: volumes ahead with continued growth in
demand in Andhra Pradesh and Telangana
●
China: lower volumes with reduced demand in
Northeast China but prices well ahead
Profit Before Tax Outlook
We
expect full-year depreciation and amortisation expense (before
impairment charges) to be broadly in line with last year (2017
reported: €1.1 billion).
The profit after tax on the divestment of our Americas Distribution
business in January 2018 amounted to €1.1 billion and is
included in profit after tax from discontinued operations. The net
gain/loss on business and non-current asset disposals in 2018,
which is dependent on the timing of divestment transactions still
to be completed, is unlikely to be material (2017
reported: €56 million).
The
Group's share of profits from equity accounted entities is expected
to be broadly similar to last year (2017 reported: €65
million).
Net
finance costs are expected to increase from last year (2017
reported: €349 million) as a result of higher average debt
levels in the period compared with 2017 due to recent acquisitions,
partly offset by the non-recurrence in 2018 of a one-off charge of
€19 million relating to the early redemption of a portion of
US dollar bonds in 2017.
Taking each of these elements into account together with our EBITDA
outlook, we expect full-year profit before tax from continuing
operations to be ahead of 2017 (2017 reported: €1.9
billion).
Capital Allocation
Demonstrating
CRH's commitment to active portfolio management as part of our
strategy to deliver improved margins and returns, the Group has
spent c. €3.5 billion on 38 acquisition/investment
transactions to date in 2018 (including deferred and contingent
consideration in respect of prior year acquisitions). On the
divestment front, the Group completed the divestment of our
Americas Distribution business in January 2018 and combined with 14
other transactions, realised business and asset disposal proceeds
of €3.0 billion.
2018 Acquisitions and Investments
The
largest acquisition to date in 2018, was Ash Grove Cement Company,
which was acquired in June 2018 for c. €2.9 billion. This
acquisition gives CRH a market leadership position in the North
American cement market, allowing for greater vertical integration
with our existing aggregates, asphalt and readymixed concrete
businesses. Our Americas Materials Division completed a further 20
bolt-on acquisitions and one investment for consideration of c.
€340 million. The Americas Products Division completed five
acquisitions at a cost of c. €145 million.
In
Europe, c. €140 million has been spent on 11 transactions;
six acquisitions and one investment in Europe Heavyside, two
acquisitions in Europe Lightside and two acquisitions in Europe
Distribution.
2018 Divestments and Disposals
The
majority of divestment proceeds relate to the divestment of our
Americas Distribution business in January 2018 for a final agreed
consideration of c. €2.4 billion. In July, the Group also
completed the divestment of our DIY business in the Netherlands and
Belgium, together with certain related property assets, for total
consideration of c. €0.5 billion. Our strategic review of the
European Distribution business is ongoing.
Share Buyback Programme
On
25 April 2018, the Group announced its intention to repurchase
ordinary shares of up to €1 billion over the forthcoming
12 months. Between 2 May and 31 July 2018, 11.35 million ordinary
shares were repurchased on the London Stock Exchange at an average
discount of 0.5% to the volume-weighted average price over the
period. Between 29 August and 18 October 2018, a further 12.45
million ordinary shares were repurchased on the London Stock
Exchange and Euronext Dublin at an average discount of 1.3% to
the volume-weighted average price over the period. This brings
total cash returned to shareholders under our ongoing €1
billion share buyback programme to
approximately €700 million. The Group remains committed
to the programme and today announced the next phase.
1Like-for-like
movements exclude the impact of currency exchange, acquisitions,
divestments and certain one-off items.
2Reported
year-to-date 2018 sales were impacted by the change in treatment of
certain direct sales at General Builders Merchants to an agency
(net commission) basis following the adoption of the new revenue
accounting standard, IFRS 15. Excluding the adjustment,
like-for-like sales for Europe were +3% and for Europe Distribution
were +1% ahead of 2017, while for Europe Distribution, including
the adjustment sales were 4% behind
2017.
CRH
will report its Preliminary Results for full-year 2018 on Thursday,
28 February 2019.
CRH plc will host an analysts' conference call and webcast
presentation at 08:30 GMT on Tuesday, 20 November 2018 to discuss
the Trading Update. To join this call please dial: +353 (0)1
2460271, user PIN *0 (further international numbers are
available here).
A recording of the conference call will be available on the Reports
and Presentations page of the CRH website.
Contact CRH at +353 1 404 1000
Albert
Manifold
Chief Executive
Senan
Murphy
Finance Director
Frank
Heisterkamp
Head of Investor Relations
About CRH
CRH (LSE: CRH, ISE: CRG, NYSE: CRH) is a leading global diversified
building materials group, employing c.85,000 people at c.3,600
operating locations in 32 countries worldwide. CRH is the second
largest building materials company worldwide and the largest in
North America. The Group has leadership positions in Europe, where
it is the largest heavyside materials business, as well as
established strategic positions in the emerging economic regions of
Asia and South America. CRH is committed to improving the built
environment through the delivery of superior materials and products
for the construction and maintenance of infrastructure, housing and
commercial projects. A Fortune 500 company, CRH is a constituent
member of the FTSE 100 index, the EURO STOXX 50 index, the ISEQ 20
and the Dow Jones Sustainability Index (DJSI) Europe. CRH's
American Depositary Shares are listed on the NYSE. CRH's market
capitalisation at 31 October 2018 was c.€22 billion. For
more information visit www.crh.com.
Disclaimer
In order to utilise the "Safe Harbor" provisions of the United
States Private Securities Litigation Reform Act of 1995, CRH public
limited company (the "Company"), and its subsidiaries
(collectively, "CRH" or the "Group") is providing the following
cautionary statement.
This document contains statements that are, or may be deemed
to be forward-looking statements with respect to the financial
condition, results of operations, business, viability and future
performance of CRH and certain of the plans and objectives of CRH.
These forward-looking statements may generally, but not always, be
identified by the use of words such as "will", "anticipates",
"should", "could", "would", "targets", "aims", "may", "continues",
"expects", "is expected to", "estimates", "believes", "intends" or
similar expressions. These forward-looking statements include
all matters that are not historical facts or matters of fact at the
date of this document.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on
circumstances that may or may not occur in the future and reflect
the Company's current expectations and assumptions as to such
future events and circumstances that may not prove
accurate.
A number of material factors could cause actual results and
developments to differ materially from those expressed or implied
by these forward-looking statements, certain of which are beyond
our control, as detailed in the section entitled "Risk Factors" in
our 2017 Annual Report on Form 20-F as filed with the US Securities
and Exchange Commission.
You are cautioned not to place undue reliance on any
forward-looking statements. These forward-looking statements are
made as of the date of this document. The Company expressly
disclaims any obligation or undertaking to publicly update or
revise these forward-looking statements other than as required by
applicable law.
The forward-looking statements in this document do not constitute
reports or statements published in compliance with any of
Regulations 6 to 8 of the Transparency (Directive 2004/109/EC)
Regulations 2007.
Registered Office: No 12965. Registered Office:
42 Fitzwilliam Square, Dublin 2, R02 R279,
Ireland
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
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CRH public limited company
|
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(Registrant)
|
|
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Date
20 November
2018
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By:___/s/Neil
Colgan___
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N.Colgan
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Company Secretary
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