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2003 interim results - six months ended 30th June 2003

02 September 2003

2003
euro m
2002
euro m
% change
Sales 4,661 4,801 -3%
Operating profit * 245 295 -17%
Profit before tax 161 196 -18%

2003
euro cent
2002
euro cent
% change
Earnings per share -before goodwill amortisation 28.89 33.51 -14%
Earnings per share - after goodwill amortisation 28.89 26.78 -17%
Cash earnings per share 69.95 76.59 -9%
Dividend 8.20 7.43 +10%

* Operating profit including share of joint ventures but before goodwill amortisation and profit on sale of fixed assets.

  • In the Republic of Ireland, residential construction was particularly buoyant and activity on major infrastructure projects continued at a good pace. Against this background operating profit increased by 14% to euro 68 million.
  • In Britain and Northern Ireland, although underlying operating profits advanced, the weakness of Sterling versus the euro resulted in reported operating profit being unchanged at euro 30 million.
  • In Mainland Europe, generally weak trading patterns for the Materials Division were exacerbated by an exceptionally cold first quarter in Poland and Finland, resulting in a 27% decline in operating profit to euro 33 million. With the incremental impact of acquisitions, the Products & Distribution Division recorded a 10% increase in operating profit to euro 54 million.
  • Reported euro results for the Americas operations were adversely affected by the impact of a 19% weakening of the average US dollar exchange rate versus the euro. The traditional first half operating loss in the Materials Division rose from euro 30 million to euro 39 million with the impact of exceptionally wet weather in the Northeast and Midwest during the second quarter only partly offset by contributions from acquisitions. In a challenging market and economic environment for all of its product groups, the Products & Distribution Division reported a 30% operating profit decline to euro 99 million.
  • Overall, currency translation effects, principally arising from the strength of the euro versus the US dollar, had a euro 10 million adverse impact at profit before tax level in the period.· The interim dividend has been increased by 10%, the 20th consecutive year of dividend increase.
  • Total acquisition and investment spend amounted to euro 577 million on 20 deals. Since period-end, we have agreed to acquire Cementbouw’s distribution and building products operations in Holland for euro 646 million and to invest euro 47 million in a leveraged buyout of Cementbouw’s materials operations.

Liam O’Mahony, Chief Executive, said today:

“Our pre-close Interim trading update statement of 30th June indicated expected pre-tax profit of euro 155 million to euro 160 million for the first half of the year. A solid performance in June, particularly in our European markets, has resulted in actual profits slightly above the upper end of the indicated range.

The second half of the year is significantly more profitable for CRH than the first six months, mainly due to the marked second half bias in the activity levels and profitability of our operations in the US. Although wet weather continued to hamper our US businesses in July and early August, we expect that, given reasonable weather from now to year-end, full year profit before tax for the Group, excluding adverse currency translation effects currently projected at euro 77 milllion, will be ahead of last year.

Our financial capacity to make acquisitions continues to be strong, and our development teams remain busy; we expect to deliver a further good level of development spend in the remaining months of the year in addition to the completion of the Cementbouw transactions announced in July.”

Announced Tuesday, 2nd September 2003

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