CRH shares soar to increase share buybacks to $3 billion in 2023 (updated)

CRH

02/03/2023 09:31

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      CRH core earnings up 13% to $5.6 billion
    

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      CEO says U.S. a "one-way" bet as it moves listing
    

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      Bucks trend of falling margins elsewhere in the sector
    

  
 (Adds detail, comment from CEO)
    By Padraic Halpin
       DUBLIN, March 2 (Reuters) - Shares in CRH  CRH.I  jumped
10% on Thursday after the building materials giant announced
plans to buy back shares worth $3 billion, a more than
three-fold increase on last year on the back of record sales and
profits for 2022.
    Dublin-based CRH also recommended moving its primary listing
to the United States where it is the largest building materials
supplier and made about 75% of its $5.6 billion in core earnings
last year, which were up 13% and ahead of expectations.
    CRH Chief Executive Albert Manifold described the U.S. as a
"one-way bet", with already robust demand boosted by government
funding such as the $430 billion U.S. Inflation Reduction Act
and a rise in the onshoring of manufacturing activity due to
geopolitical changes.
    "The U.S. really is in good shape and we're facing I suspect
five to 10 years of really strong growth," Manifold told Reuters
in a telephone interview.
    "We are now at an historic step-off point in the United
States. We had the confluence of events coming together, three
very, very significant federally funded programmes, the likes of
which the United States has never seen before."
    In the nearer term, CRH said it expected resilient demand
and increased pricing in 2023. 
    Its London-listed shares  CRH.L  were 10.9% higher at 4,391
pence at 0905 GMT, making it one of the top 5 gainers on the
blue-chip FTSE 100  .FTSE  index.
    Manifold also said Europe "held up very, very well" last
year despite the difficult inflationary environment.
    Those cost pressures did not stop CRH from bucking a trend
of falling margins across the sector by instead growing its
EBITDA margin for the 10th successive year, up 10 basis points
to 17.2%.
    The leap in share buybacks from the $1.2 billion worth of
stock it purchased last year reflected the fact that its balance
sheet has never been stronger, with net debt at 0.9 times core
earnings, Chief Financial Officer Jim Mintern said.
    CRH also increased dividends by 5% to $1.27. 

 (Reporting by Padraic Halpin; editing by Jason Neely, Robert
Birsel)
 ((padraic.halpin@thomsonreuters.com; +353 1 500 1504; Reuters
Messaging: padraic.halpin.thomsonreuters.com@reuters.net))