“With changing regional growth dynamics in the global economy, management is undertaking a detailed assessment of our portfolio to focus on the businesses which offer the most attractive future returns,” says CRH said in a trading update.
The group spent €660 million on bolt-on acquisitions during the three-month period, with about 25% of the investments in developing regions, including China, Ukraine and India.
CRH has generated €2 billion in disposals since 2007 but says there is more to do, pointing out that the sale of businesses and the impact of the still-difficult environment in Europe where it makes some half of its revenue, could give rise to a non-cash impairment charge in its 2013 accounts. It says it has also identified cost savings of €175 million for 2014 and 2015, on top of €195million this year and a total of €2.4 billion since 2007.
The group reported a sharp fall in first-half earnings following a long period of bad weather although its revenue rose to €5.4 billion between July-September, 2013, following better weather in the US.
Third-quarter earnings before interest, tax and deprecation rose to €0.66 billion despite the negative effect of currency movements.
Revenues in the US, where CRH is among the leading producers of asphalt for highway construction, grew 4% year-on-year while sales in Europe fell by 1% after a 10% drop in the first-half.
CRH says that its second-half earnings before EBITDA are expected to be in line with 2012.
