The building industry faces what CRH calls “cost headwinds” as inflation grips the industry (Ben Birchall/PA)
(Picture: PA Archive)CRH, the global building materials giant, has pointed to a “challenging and volatile” environment for costs as inflation continues to hammer the building sector.
There were signs within its results for the six months to June 30 of the impact. Operating profit in its Europe West division fell year-on-year, where its precast concrete business grew sales but took a hit on profit from rising costs. In Europe East, CRH said it it was continuing to assist its staff in Ukraine
The global company said it was able to offset the overall impact of rising costs due to “a strong focus on commercial and operational initiatives” and reported a rise of over 2% in earnings of $2.2 billion, from sales of $15 billion, up 14%. Margins rose across the group and stayed flat in Europe while ongoing “backlogs” were still helping parts of its business.
It also pointed to “adverse weather” which held back activity in parts of its American business, where ready mixed concrete volumes fell 6% as “weather related challenges in West and Northeast” offset “strong demand in the South.”
CRH’s spending on acquisitions reached $2.8 billion, including Barette Outdoor Living, the fencing and railings chain in the US and parts of Canada, for $1.9 billion.
It forecast full-year earnings of $5.5 billion, above the $5 billion made in 2021. It lifted its interim payout to shareholders by 4%, announcing a dividend of $0.24 per share.
“Looking ahead, despite some continued cost headwinds, the strength of our balance sheet and resilience of our business leaves us well positioned to deliver superior value for all our stakeholders,” said Albert Manifold, Chief Executive.
Shares in the FTSE 100 company rose almost 4% to 3253p in early London trade.
