Final Results - Pre-tax Profit Up 40%
CRH PLC
29 February 2000
Results for the year ended 31st December, 1999
Euro
Sales* 6,734 m up 29%
Profit before tax
- excluding exceptional items 571 m up 40%
- including exceptional items 635 m up 55%
Basic earnings per share
(after goodwill amortisation)
- excluding exceptional items 106.51c up 35%
- including exceptional items 116.38c up 47%
Cash earnings per share 177.00c up 45%
Dividend per share 20.00c up 17%
Trading profit by destination* Euro m %
(excluding exceptional items)
Republic of Ireland 114.7 17 up 12%
Britain and Northern Ireland 59.6 9 up 62%
Mainland Europe 104.0 16 up 58%
The Americas 385.1 58 up 56%
------
663.4 100 up 47%
======
Dividend cover
(excluding exceptional items) 5.3 times (1998: 4.6 times)
Interest cover*
(excluding exceptional items)
- EBIT basis 7.2 times (1998: 10.5 times)
- EBITDA basis 10.1 times (1998: 14.4 times)
* Sales, trading profit and interest cover include share of joint ventures.
Liam O'Mahony, Chief Executive, said today:
'At the core of CRH's consistent strategy are its twin imperatives of
performance and growth and this strategy in action is reflected in our strong
1999 results and record development spend. We are confident that 2000 will be
another year of progress.'
RESULTS
The results highlights are:
Turnover was Euro 6,734 million, an increase of 29 per cent on 1998.
Trading profit excluding exceptional items was Euro 663.4 million, an
increase of Euro 212 million or 47 per cent.
Profit before tax excluding exceptional items advanced to Euro 571 million, an
increase of 40 per cent.
The exceptional items amount to a net Euro 64.2 million and comprise a profit
on disposal of Keyline Builders Merchants partly offset by a write-down in the
carrying value of fixed assets at Premier Periclase.
Profit before tax including exceptional items was Euro 635 million, an
increase of 55 per cent.
Basic earnings per share excluding exceptional items amounted to 106.51 cents,
an increase of 35 per cent.
Cash earnings per share was 177.0 cents, an increase of 45 per cent.
Aided by strong markets in Ireland and North America, improving markets in
Britain and Mainland Europe and with the benefits of a record Euro 1.5
billion development spend, we achieved substantial growth in sales and
profitability pushing the Group to new record levels.
Exchange effects in 1999 arising from the strengthening of Sterling and US
Dollar versus the Euro had a positive Euro 13 million impact on reported
profit before tax.
The Group profit and loss account on page nine separately discloses
the impact of 1999 acquisitions as well as results from discontinued
operations. The latter category includes results for Keyline, disposal
of which was completed in early June; for Caima Ceramica which was
acquired as part of the Ibstock transaction in 1998 and sold in March 1999,
and for the Farrans Group plant and engineering division in
Northern Ireland which was sold in October.
Dividends
The Board is recommending a final net dividend of 14.10 cents net per share,
an increase of 17 per cent on the 1998 second interim dividend of 12.06 cents
paid in lieu of a final dividend. This makes a total net dividend
for the year of 20.00 cents (1998:17.14 cents), an increase of 17 per
cent.
It is proposed to pay the final dividend on 8th May, 2000 to shareholders
registered at close of business on 10th March, 2000. A scrip dividend
alternative is being offered to shareholders.
Development
The major strategic moves of 1999 were the acquisitions of Finnsementti/Rudus
and Thompson-McCully both completed in the month of July and the
disposal of Keyline in early June. The Finnsementti/Rudus deal
expands our cement capacity in Europe, complements and strengthens our
Polish readymixed concrete and aggregates operations and offers
platforms for further growth in the Baltic region. The purchase of
Thompson-McCully, the market leader in asphalt in Michigan, provides an
entry into the attractive US midwest materials markets.
Republic of Ireland
We continued our programme to improve efficiency and increase production
capacity with a total investment of Euro 65 million in 1999. Roadstone
Dublin replaced existing block manufacturing capacity with a high output
plant, extended its material reserves in a number of strategic locations
and increased production capacity in concrete and aggregate
production. Roadstone Provinces opened a new concrete paver plant in
Limerick, blacktop plants at Bunratty and Slane and also upgraded aggregate
output in several key locations. The rooftile product range was extended
with the installation of a new production line in Dublin and a new facility
which is now under construction in Cork. Concrete pipe output will
increase following commissioning this year of a new factory by John
A.Wood. Clogrennane Lime commissioned a new 300 tonnes per day burnt
lime plant at its Carlow facility, more than doubling its capacity.
Irish Cement obtained planning permission for an extension to its
Limerick plant and is completing construction of a deepwater import
terminal in Dublin to respond to any further growth in the cement market.
Britain and Northern Ireland
In September, Ibstock acquired a modern brick factory at Ellistown
in Leicestershire, which has performed well since acquisition. At
year end an older factory at Himley was closed, contributing to the
industry's need to bring capacity more in line with market demand. In
Northern Ireland, we acquired Ballymena Construction Limited, a rooftile and
concrete pipe business, and disposed of our plant sales and engineering
company in a management buyout. Activities are now focused on materials
and construction.
Mainland Europe
In our Dutch distribution businesses five DIY stores were completely
refurbished and a store at Waalwijk was acquired expanding our retail
chain. Kelders roofing added a branch in Utrecht with the acquisition
of Fielmich Dakmaterialen in September. In June, we acquired Kooy Bilthoven,
the leading brick merchant in the Netherlands. Heras established a sales
depot in Warsaw. Also in Poland, the successful construction and
commissioning of a new 'state of the art' 8,000 tonnes per day kiln at
the Ozarow cement plant on time and within budget was an outstanding
achievement for our multinational project team. Integration of the
Rudus operations in Poland and two further small acquisitions now gives
CRH 3.5 million tonnes of aggregate production, a developing concrete
products network and the number one position in the concrete market in
Warsaw.
The Americas
The Materials Group acquired 14 new companies, including
Thompson-McCully. In the northeast we added Dell and Millington in New
Jersey, Poughkeepsie Asphalt in Upstate New York and Slusser Brothers in
Pennsylvania. In the west three add-on acquisitions, now merged as
Waycor Materials, were completed in Albuquerque, New Mexico and we also
added Keigley Quarry in Utah, B&B Excavating in Colorado, Cundy Asphalt
in Wyoming and Idaho Concrete and Hunziker Construction in the Idaho market.
The acquisition of South Kent Sand & Gravel saw the first bolt-on
acquisition for Thompson-McCully. The Architectural Products Group (APG)
acquired Young Block of Arizona, Eagle Concrete Products of Texas and 4D of
Michigan in addition to three concrete rooftile plants located in Arizona,
California and Florida. A major greenfield development programme to
increase production of lawn, garden and paving products saw the
commissioning of a new paver plant in Waco Texas with three others under
construction in Pennsylvania, Tennessee and California. Sakrete PNW, which
was acquired as the year ended, strengthened APG's strong regional
position in dry mixes. The Glass Group acquired Free State Glass,
located near Washington DC and two specialty glass businesses in South
Carolina and California. Major investments in plant and equipment were
completed by the Precast Group in the states of Georgia, Tennessee, Texas and
Washington and the operations of Cloud Concrete in Tennessee and Kentucky
were acquired providing a strong position in this region of the US.
Allied Building Products, of the Distribution Group, completed its
computer conversion. In South America, we purchased a 50% interest in
Vidrios Dell Orto, a leading glass fabricator in Chile.
Finance
The strong cash generation characteristics of the Group combined with Euro
331 million disposal proceeds, mainly from the sale of Keyline, enabled us
to spend a total of Euro 1,781 million during 1999 on acquisitions and
capital projects with only a Euro 940 million increase in net debt. Our
interest and dividend cover and balance sheet remain healthy and we enter
2000 with a balanced mix of fixed and floating rate debt and currency net
worth. These factors, combined with the Group's continuing strong cash
flow and diversified earnings base underpin the continuation of our
development strategy.
Operations review
Republic of Ireland
Construction output in Ireland set another record with volume growth
exceeding 10%. House construction increased overall by 16% but limited
availability of serviced land and planning delays constrained output
growth in the Dublin market to only 2%. Road construction showed a
similar lack of balance as major planned projects in Dublin were delayed.
Despite the high level of activity price improvements again failed to
match inflation in a well-supplied and competitive market. Profits were up
but margins remained largely the same, constrained by cost increases that
were not fully recovered.
Market conditions world-wide for refractory materials remained extremely
competitive and as a result Premier Periclase had a difficult year.
Britain and Northern Ireland
In a subdued UK brick market where deliveries equalled the level of the
previous year, Ibstock Building Products focussed on reducing
manufacturing costs and streamlining business processes. Ibstock's
corporate head office was closed at the end of May. Ibstock had a
satisfactory first year and has integrated well into the CRH Group.
Forticrete showed further improvement and early synergies have already been
realised from the integration of Ibstock's stone walling and masonry
business. Profits at Combat Polystyrene suffered from the closure costs of
a non-core lossmaking facility at Livingstone in Scotland.
In Northern Ireland, Farrans Group increased product sales by 10% in a
difficult pricing environment and profits improved.
These results include trading at Keyline Builders Merchants for the
months January to May as well as an exceptional profit before tax of Euro
79.5 million arising from its disposal in early June.
Mainland Europe
In western Europe market conditions were neutral to positive, generally
showing an improvement on 1998 with more favourable weather conditions.
Our Distribution businesses in the Netherlands scored good advances with
profits ahead. DIY superstores continued to perform to best expectations
and our specialist merchants, Garfield Aluminium, Kelders roofing and
Van Neerbos heavyside also reported improved results. Bouwmaat continued to
make progress while the Syntec ironmongery business disappointed. In France,
the co-operation between Materiaux Service and Raboni developed most
satisfactorily and, aided by the growing French economy, we scored double
digit sales and profit gains. Results at MaxMat, our joint venture on
the Iberian Peninsula, were adversely impacted by heavy opening costs
for new stores. Both partners are working actively to improve results in
what is a promising market.
Our Concrete Products Group struggled to match the excellent
performance of the previous year. Despite strong demand there is too much
capacity on the Dutch market and both Struyk Verwo in paving and Dycore
Verwo in flooring encountered intense price competition. In Belgium Marlux
showed a good profit improvement while Remacle and Max Pels, the precast
concrete companies acquired in 1998, had a good first full year. In France,
Prefaest, also acquired in 1998, had a difficult year
and incurred losses.
In the Netherlands the Clay Products Group encountered increased price
competition. While demand is good, plant upgrades in the industry have
increased overall capacity and combined with a reduction in exports to
Germany this has resulted in a difficult marketplace. Profits were lower
than in 1998. In Germany, AKA Ziegelwerke is still operating below
capacity although intense price competition abated. Production capacity
was rationalised and one line was closed permanently. Profits improved in a
depressed market.
In the Building Products Group Heras Fencing enjoyed a better year with
significantly higher profits. Rooflights and Ventilation had a good
year in the Benelux offset by difficulties in Germany where
performance reflected a weak market. Vebofoam, our insulation company
in Belgium, reported improved results.
In the Europe Materials Division, volume and price improvements in
Beton Catalan in Spain added 12% to sales revenue delivering better
margins and financial returns. In Finland, results for Finnsementti/Rudus
for the five months post acquisition were somewhat better than
expectations. In Poland, despite a slowdown in GDP growth, the construction
sector advanced by more than 10% driven mainly by industrial, civil
engineering and retail and office construction. Residential construction
continued to disappoint due to a lack of affordable mortgage finance.
With cement consumption continuing its steady growth at about 7%,
Cementownia Ozarow and Rejowiec benefited from additional volumes and
better prices.
The Americas
1999 was another strong year for the US economy giving an unparalleled
period of growth and prosperity. A combination of historically low
interest rates, further increases in equity markets and buoyant
consumer confidence provided a backdrop for a healthy construction
market, with output growing 2%. In South America political uncertainty
and the devaluation in Brazil impacted negatively on the Argentine economy.
The Materials Group continued its rapid growth in 1999 with another year
of record results and development. All of the group's major markets grew as
non-residential construction remained buoyant and the Transportation
Equity Act for the 21st Century (TEA 21) positively impacted highway
sector volumes in the second half. However, variable implementation of
TEA 21 funding as the design and planning process got underway, some
reduction of state funding in our major New York market and the diversion
of maintenance monies to large projects in several states muted the
positive effects. Dramatically higher crude oil prices led to increases in
bitumen, a major component of asphalt, and other energy costs which were
not fully recoverable in the period. The weather was reasonable, but we did
not benefit to the same extent as in 1998 from the exceptional mild
late autumn and early winter weather.
Materials Northeast: Pike Industries had a solid year with record volumes
and improved margins. Vermont, New Hampshire and Maine operations enjoyed
strong highway markets but Massachusetts disappointed due to the
diversion of maintenance monies into Boston's ongoing 'Big Dig' project.
Tilcon Connecticut completed another excellent year while Tilcon New York,
which operates in New York City, New York State and New Jersey benefited
from robust construction markets in New York City. Newly acquired Dell and
Millington in New Jersey completed the year in line with expectations.
Performance in Upstate New York improved despite stagnant markets while the
mid-Atlantic group in Pennsylvania and Delaware had a record year complemented
by the acquisition of Slusser Brothers of Pennsylvania in July.
Materials West: Staker Paving and the Jack B. Parson companies performed
soundly in competitive Utah, Idaho and Wyoming markets. Our operations in
the southwest (Colorado and New Mexico) had a mixed year with a strong
performance from United Companies and B&B Excavating offset by lower
volumes and higher costs in the Four Corners operations in southern Colorado
and northern New Mexico. The newly acquired Albuquerque operations had a
satisfactory start in the group. CPM Development in eastern Washington
and Northern Idaho had another excellent year enjoying strong markets in
highways and private construction. Segale, in Seattle, Washington,
had a difficult year with few new major state projects being let. Hills
Materials Company in South Dakota and the recently acquired Cundy Asphalt
Paving in eastern Wyoming had an outstanding year.
Materials Midwest: Results from Thompson-McCully, acquired early
July, were broadly in line with expectations and integration is
going well. We see excellent scope for further profitable growth through
our traditional programme of bolt-on deals in this area of the country.
The Architectural Products Group had another strong performance in 1999
with significant growth in sales and profits. Growth in the Oldcastle(TM) DIY
lawn and garden business and in the new Belgard(TM) professional
hardscapes programme were strong contributors to APG's record year.
Groupe Permacon in Canada had an exceptional year while Superlite in Arizona,
Adams Products and Betco in the east and Big River, the group's
lightweight aggregates operation, were all ahead of expectations. Concrete
Designs in Arizona, Bosse in Georgia and Miller Materials in Missouri
were also strongly ahead. In Indiana, Schuster consolidated its 1998
recovery with a good outcome. Glen-Gery, acquired at the end of 1998 as
part of the Ibstock acquisition, enjoyed strong residential and commercial
demand for its products and the outcome for the year was well ahead of
expectations and 1998.
The Glass Group performed well in 1999 with solid advances in sales
and profitability. Local, customer-driven management teams delivered
exceptional service to their markets and exceeded revenue expectations.
Strong performances were achieved in every region of the US and results
improved in Canada.
The Precast Group had another excellent year with all-time highs in both
sales and operating profits and further progress with its phased programme
of upgrading facilities. The northeast continued to improve with a
good increase at Rotondo and a strong recovery at Spancrete. Operations
in the southeast also made strides while operations in the west and
California in particular continued to improve on 1998 performances.
1999 was an important transition year for the Distribution Group.
Allied achieved its margin recovery target and completed phase one of
its computer conversion on schedule and at expected cost. Allied now
has a sophisticated infrastructure designed to achieve improved operating
efficiency and margin enhancement, while providing significant capacity
to accommodate further growth. Results improved on a difficult 1998.
South America: Canteras Cerro Negro in Argentina performed well and
profits were ahead of the previous year. During 1999, the Group purchased
50% of Vidrios Dell Orto, the leading glass fabricator in Chile. The
operating results were in line with expectations.
Outlook 2000
2000 promises to be another year of strong economic performance in
Ireland fuelling more demand for our products. The infrastructure deficit
is finally getting attention and all companies are well positioned to
benefit from the National Development Plan. Growth in Ireland should
settle down to lower but still strong levels.
In Europe forecasts for the construction industry in our markets are positive.
The UK is picking up with signs of further growth in 2000, against a
background of overcapacity in clay products, our major market there.
Markets in the Benelux are also positive. A major business challenge is
to cope with overcapacity in clay and concrete products, particularly in the
Netherlands and Germany, where the recovery is slow to materialise.
Spain forecasts growth in construction although some signs of higher
inflation are a cause for concern. Finland is also expecting an increase
in output, which should underpin the steady development of our cement,
concrete and aggregate businesses there. In Poland good GDP growth is
forecast and construction output is expected to grow in line with this.
The US economy continues its ninth straight year of economic growth.
However rising interest rates sound a cautionary note. Currently forecasts
are for modest growth in the overall economy and in construction in
2000. Bitumen costs are still rising and could impact, though we expect
to mitigate this through effective purchasing and price increases as
appropriate. Given our geographic spread, end-use balance, TEA 21 driven
growth and barring any major economic setback, we look to continue the
good progress of recent years.
We will continue to fine-tune the integration of the major 1999
acquisitions and on the development front we will continue with our strong
programme across all regions. Since year end we acquired the stock of
The Shelly Company, a major materials business in Ohio and West Virginia for
US$362 million.
We are confident that 2000 will be another year of progress.
Financial results and supplementary information
===============================================
Group profit and loss account for the year ended 31st December, 1999
--------------------------------------------------------------------
Continuing
operations Discon-
---------------- tinued
Acquis- opera-
itions tions Total Total
1999 1999 1999 1999 1998 Change
Euro m Euro m Euro m Euro m Euro m %
Sales 5,844.5 637.4 251.9 6,733.8 5,210.9 +29.2
Less:
Share of joint ventures 128.3 6.1 - 134.4 176.6
------- ----- ----- ------- -------
Group sales 5,716.2 631.3 251.9 6,599.4 5,034.3 +31.1
Cost of sales 3,849.5 447.6 198.9 4,496.0 3,413.4
Exceptional
impairment cost 15.3 - - 15.3 -
------- ----- ----- ------- -------
Gross Profit 1,851.4 183.7 53.0 2,088.1 1,620.9
Operating costs (1,294.0) (101.6) (43.4) (1,439.0) (1,194.2)
Goodwill amortisation (9.0) (10.5) (0.1) (19.6) (1.3)
------- ----- ----- ------- -------
Operating profit 548.4 71.6 9.5 629.5 425.4
Share of joint ventures'
operating profit 11.1 0.7 - 11.8 15.4
Profit on disposal of
fixed assets 4.4 0.4 2.0 6.8 11.0
Exceptional gain on sale
of Keyline - - 79.5 79.5 -
Trading profit, including ------- ----- ----- ----- -----
share of joint ventures 563.9 72.7 91.0 727.6 451.8 +61.0
======= ===== =====
Group interest payable (net) (91.8) (37.5)
Share of joint ventures' net interest (0.9) (5.4)
----- -----
Profit on ordinary activities before taxation 634.9 408.9 +55.3
Taxation on profit on ordinary activities (152.0) (99.9)
Taxation on exceptional items (25.7) -
----- -----
Profit on ordinary activities after taxation 457.2 309.0
Profit applicable to equity minority interests 3.1 3.3
Preference dividends 0.1 0.1
Profit for the year attributable to ----- -----
ordinary shareholders 454.0 305.6 +48.6
Dividends - paid 23.3 19.8
- proposed/payable 55.2 46.8
----- -----
Profit retained for the financial period 375.5 239.0
===== =====
Earnings per Ordinary Share
Including exceptional items:
- basic 116.38c 79.13c +47.1
- diluted 114.82c 78.58c +46.1
Excluding exceptional items:
- basic 106.51c 79.13c +34.6
- diluted 105.08c 78.58c +33.7
Cash earnings per Ordinary Share 177.00c 122.09c +45.0
Statement of total recognised gains and losses
for the year ended 31st December, 1999
----------------------------------------------
1999 1998
Euro m Euro m
Profit for the year attributable to
ordinary shareholders 454.0 305.6
Currency translation effects on
- results for the year 22.4 (6.5)
- foreign currency net investments 156.9 (15.2)
----- -----
Total recognised gains and losses for the financial year 633.3 283.9
===== =====
Movements on profit and loss account
------------------------------------
1999 1998
Euro m Euro m
At 1st January 887.8 670.5
Profit retained for the financial year 375.5 239.0
Currency translation effects on results for the year 22.4 (6.5)
Currency translation effects on foreign currency
net investments 156.9 (15.2)
Re-denomination of Ordinary / Income Shares (3.8) -
Goodwill written back on disposal of Keyline 57.6 -
------- -----
At 31st December 1,496.4 887.8
======= =====
Group balance sheet as at 31st December, 1999
---------------------------------------------
1999 Restated 1998
--------------- ---------------
Euro m Euro m Euro m Euro m
Intangible assets
Goodwill 629.2 138.2
Tangible fixed assets 3,225.8 2,287.6
Financial fixed assets
Investment in joint ventures
- share of gross assets 106.3 86.5
- share of gross liabilities (62.6) (57.1)
- loans to joint ventures 14.2 15.6
Other investments 8.7 7.6
----- -----
66.6 52.6
Current assets
Stocks 662.3 575.7
Debtors 1,082.5 905.6
Cash, short-term deposits and
liquid resources 972.2 1,314.2
------- -------
2,717.0 2,795.5
------- -------
Creditors
(amounts falling due within one year)
Bank loans and overdrafts 260.0 188.9
Trade and other creditors 1,042.0 897.5
Corporation tax 39.7 24.5
Dividends 55.2 46.8
------- -------
1,396.9 1,157.7
------- -------
Net current assets 1,320.1 1,637.8
------- -------
Total assets less current liabilities 5,241.7 4,116.2
======= =======
Creditors
(amounts falling due after more than one year)
Loans 2,381.5 1,854.8
Deferred acquisition consideration 205.5 81.4
Corporation tax 32.2 31.1
------- -------
2,619.2 1,967.3
Capital grants 18.8 19.9
Provisions for liabilities and charges 365.0 289.7
Capital and reserves
Called-up share capital:
Equity share capital 133.1 128.0
Non-equity share capital 1.2 1.2
Equity reserves:
Share premium account 561.1 527.1
Other reserves 9.9 9.9
Profit and loss account 1,496.4 887.8
------- -------
Shareholders' funds 2,201.7 1,554.0
Minority shareholders'equity interest 37.0 285.3
------- -------
5,241.7 4,116.2
======= =======
Supplementary information
-------------------------
1 Translation of foreign currencies
------------------------------------
The financial statements are presented in Euros. Results and cash
flows of subsidiary and joint venture undertakings based outside the Euro
countries have been translated into Euros 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. Adjustments arising
on translation of the results of non-Euro subsidiary and joint venture
undertakings at average rates, and on restatement of the opening net
assets at closing rates, are dealt with in retained profits, net of
differences on related currency borrowings. Any other translation
differences are included in arriving at trading profit. Rates used for
translation of results and balance sheets into Euros were as follows:
Average Year-end
Euro 1 = 1999 1998 1999 1998
U.S. Dollar 1.0658 1.1230 1.0046 1.1668
Pound Sterling 0.6587 0.6775 0.6217 0.7054
Polish Zloty 4.2274 3.9218 4.1587 4.0908
2 Discontinued operations
--------------------------
On 4th June, 1999, the Group sold Keyline Builders Merchants Limited
('Keyline'), a subsidiary based in the UK, to Travis Perkins PLC.
On 22nd March, 1999, the Group disposed of its entire holding in Caima
Ceramica e Servicos SGPS S.A. ('Caima'), a former subsidiary of Ibstock
PLC based in Portugal. No profit or loss arises on this
transaction.
On 29th October, 1999, the Group's subsidiary Farrans Limited sold the net
assets and business of its Plant and Engineering division.
The results of Keyline, Caima and of the Farrans Plant & Engineering Division
up to the date of sale are reported under 'discontinued operations' in the
Group profit and loss account.
3 Restatement of prior year balance sheet
------------------------------------------
Following implementation of Financial Reporting Standard 12 - Provisions,
contingent liabilities and contingent assets (FRS 12), provisions
amounting to Euro 204.9 million at 31st December, 1998 which were
previously included in trade and other creditors in the balance sheet, are
now analysed separately as part of provisions for liabilities and charges.
4 Exceptional items
--------------------
1999
-------------------------
Exceptional Taxation
items
Euro m Euro m
Continuing operations - cost of sales
- Fixed asset impairment cost, Premier Periclase (a) (15.3) (1.6)
Discontinued operations
- Profit on disposal of Keyline Builders Merchants (b) 79.5 27.3
----- ----
Total exceptional items 64.2 25.7
===== ====
(a) Financial Reporting Standard 11 - Impairment of Fixed Assets and
Goodwill (FRS 11) requires an assessment of the carrying value of
fixed assets, in situations where impairment may have arisen, by
reference to future cash flows and estimated net realisable value. An
impairment review of the fixed assets of Premier Periclase indicated that
the current carrying value is not supported and a write-down has accordingly
been reflected in these results.
(b) As described in Note 2, the Group sold its UK subsidiary Keyline
Builders Merchants Limited in June 1999. The profit on sale of Keyline, net
of goodwill of Euro 57.6 million previously written-off against CRH
reserves, amounted to Euro 79.5 million.
5 Geographical analysis
------------------------
Geographical analysis by destination 1999 1998
------------- -------------
Euro m % Euro m %
Sales, including share of joint ventures
Republic of Ireland 599.8 8.9 540.9 10.4
Britain & Northern Ireland 847.6 12.6 770.2 14.8
Mainland Europe 1,580.9 23.5 1,143.0 21.9
The Americas 3,705.5 55.0 2,756.8 52.9
------- ---- ------- ----
6,733.8 100 5,210.9 100
Less share of joint ventures (134.4) ==== (176.6) ====
------- -------
Group sales 6,599.4 5,034.3
======= =======
Trading profit,
including share of joint ventures
Republic of Ireland 114.7 17.3 102.6 22.7
Britain & Northern Ireland 59.6 9.0 36.9 8.2
Mainland Europe 104.0 15.7 65.9 14.6
The Americas 385.1 58.0 246.4 54.5
----- ---- ----- ----
Trading profit excluding exceptional items 663.4 100 451.8 100
Exceptional items, net 64.2 ==== - ====
----- -----
Trading profit including exceptional items 727.6 451.8
===== =====
Geographical analysis by origin 1999 1998
------------- -------------
Euro m % Euro m %
Sales, including share of joint ventures
Republic of Ireland 626.0 9.3 577.2 11.1
Britain and Northern Ireland 843.6 12.5 749.7 14.4
Mainland Europe 1,557.3 23.1 1,127.6 21.6
The Americas 3,706.9 55.1 2,756.4 52.9
------- ---- ------- ----
6,733.8 100 5,210.9 100
Less share of joint ventures (134.4) ==== (176.6) ====
------- -------
Group sales 6,599.4 5,034.3
======= =======
Trading profit,
including share of joint ventures
Republic of Ireland 119.6 18.0 110.5 24.5
Britain and Northern Ireland 54.2 8.2 31.2 6.9
Mainland Europe 104.5 15.8 63.8 14.1
The Americas 385.1 58.0 246.3 54.5
----- ---- ----- ----
Trading profit excluding exceptional items 663.4 100 451.8 100
Exceptional items, net 64.2 ==== - ====
----- -----
Trading profit including exceptional items 727.6 451.8
===== =====
6 Movements in shareholders' funds
-----------------------------------
1999 1998
Euro m Euro m
At 1st January 1,554.0 1,309.6
Profit retained for the financial year 375.5 239.0
Currency translation effects 179.3 (21.7)
Issue of ordinary share capital (net of expenses) 35.3 27.1
Goodwill written-back on disposal of Keyline 57.6 -
------- -------
At 31st December 2,201.7 1,554.0
======= =======
7 Summarised cash flow
-----------------------
This table summarises the Group's cash flows for 1999 and 1998.
1999 1998
Euro m Euro m
Inflows
Profit before tax (excluding exceptional items) 571 409
Depreciation and goodwill amortisation 275 166
Disposals 331 33
Share issues (net of expenses) 35 27
Working capital movement (47) 89
----- -----
1,165 724
----- -----
Outflows
Capital expenditure 360 232
Acquisitions and investments 1,421 604
Dividends 71 61
Tax paid 160 101
Other 14 16
----- -----
2,026 1,014
----- -----
Net outflow (861) (290)
Translation adjustment (79) 26
----- -----
Increase in net debt (940) (264)
===== =====
8 Other
--------
1999 1998
Dividend cover (times) * 5.29 4.59
EBIT interest cover (times) * 7.2 10.5
EBITDA interest cover (times) * 10.1 14.4
Average shares in issue (millions) 390.1 386.2
Net dividend per share (cents)** 20.00c 17.14c
Tax credit on net dividend payable on:
- Ordinary Shares - ** 0.952304c
- Income Shares - ** 2.118608c
Depreciation charge - Euro m 255.4 164.6
Goodwill amortisation charge - Euro m 19.6 1.3
Net debt - Euro m 1,669.3 729.5
Debt ratio 74% 39%
Debt to year-end market capitalisation 20% 13%
* dividend and interest cover including share of joint ventures and
excluding exceptional items
** dividend payments made on or after 6th April, 1999 do not carry a tax
credit
9 Abbreviated accounts
-----------------------
The results disclosed herein do not represent full accounts. Full
accounts for the year ended 31st December, 1999, upon which the
Auditors have given an unqualified audit report, have not yet been filed
with the Registrar of Companies. Full accounts for the year ended 31st
December, 1998 containing an unqualified audit report from the Auditors
have been delivered to the Registrar of Companies.
10 Distribution of this Preliminary Announcement
-------------------------------------------------
These results are available on the Group's Website at www.crh.ie. A
printed copy is available to the public from Wednesday, 1st March, 2000
at the Company's registered office.
11 Annual Report post-out and Annual General Meeting (AGM)
-------------------------------------------------------------
The 1999 Annual Report will be posted to shareholders on Monday, 27th March,
2000 together with details of the Scrip Dividend Offer in respect of
the Final 1999 dividend. The 1999 Annual Report is available to the
public from Tuesday, 28th March, 2000 at the Company's registered office.
The Group's AGM will be held in Jurys Hotel on Wednesday, 3rd May, 2000.
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