CRH (LON:CRH) has updated investors on its first-quarter performance.
Highlights from the company statement:
· A satisfactory start to 2017 with first quarter sales up 4% compared with a strong first quarter of 2016 which benefited from very mild weather conditions across all our major markets.
· Group EBITDA for the seasonally less significant first half of the year is expected to be ahead of last year (H1 2016: €1.12 billion). Based on current momentum, further progress in the second half of the year is anticipated (H2 2016 EBITDA: €2.01 billion).
Like-for-like* Group sales for the first quarter of 2017 increased by 3% compared with the same period last year. In the Americas, despite less favourable weather conditions and very challenging prior year comparatives, the economic and business environment remained positive and, excluding the favourable impact of the strong US Dollar exchange rate this year, like-for-like sales were in line with 2016. In Europe, like-for-like sales growth of 6% was supported by stabilising trends in certain key markets and by the timing of Easter holidays which occurred in the first quarter of 2016. Activity in the Philippines had a slow start to the year with like-for-like sales 12% behind Q1 2016 impacted by poor weather and competitive market conditions.
First Half Outlook
In the Americas, with the benefit of a positive demand environment, EBITDA is expected to be ahead of last year (H1 2016: €563 million) while we expect first half EBITDA in Europe to be broadly in line (H1 2016: €499 million). EBITDA for Asia is expected to be behind due to competitive pricing conditions in the Philippines (H1 2016: €58 million). Overall we expect total Group EBITDA for the seasonally less significant first half of the year to be ahead of last year (H1 2016: €1.12 billion).
Second Half Outlook
Looking ahead to the second half of the year, in Europe we expect some modest improvement across our main markets. In the United States, residential construction, which has still not returned to long-term average levels, is expected to advance; non-residential activity is also expected to improve; for US infrastructure, we anticipate that the funding stability provided by the FAST Act will lead to a more positive trend for volumes in H2; as a result, we expect EBITDA improvements in the Americas in the second half of the year. In Asia, our expectation is that challenging market conditions in the Philippines will continue in H2. Against this backdrop and based on current momentum, we continue to expect to make further progress on a Group EBITDA basis in H2 2017.