CRH(CRH) - 2023 Q1 - Quarterly Report

Report Information Filing Details This document is a Form 6-K report submitted by CRH public limited company, disclosing the company's full-year results for fiscal year 2022 and containing inside information - This report is a Form 6-K filing by CRH public limited company, disclosing full-year results for fiscal year 2022[25][30][54] - The document explicitly states it contains inside information[25][264] Key Highlights 2022 Performance & Strategic Initiatives The company achieved strong performance in 2022 with double-digit growth in sales and EBITDA, and a 14% increase in EPS, while adopting efficient capital allocation, boosting share buybacks, and strengthening its portfolio through strategic acquisitions, alongside updated decarbonization targets and a planned US primary listing - Strong 2022 performance with growth in sales, EBITDA, margins, and EPS, despite significant cost inflation[30][33][55] - Adopted an efficient and disciplined capital allocation approach, with a 5% increase in annual dividend and a plan to significantly increase share buybacks to $3.0 billion over the next 12 months[26][75][98][99] - Invested $3.3 billion in solutions-focused acquisitions, with a strong pipeline of future opportunities[26][77][103] - Maintained a robust and flexible balance sheet, providing significant optionality for future value creation[26][76][101][102] - Elevated sustainability ambitions, updating the 1.5°C decarbonization target[26][59] - Introduced a new organizational structure aligned with the integrated solutions strategy[26][58] - Proposed a transition to a US primary listing in 2023[26][79][80] 2022 Key Financial Summary | Metric | 2022 Data | Change Rate | |:-----------|:-----------|:-------| | Sales | $32.7 billion | +12% | | EBITDA | $5.6 billion | +13% | | EBITDA Margin | 17.2% | +10bps | | EPS | $3.50 | +14% | CEO Statement CEO's Message CEO Albert Manifold emphasized that 2022's strong performance resulted from employee commitment, business resilience, and the integrated solutions strategy, leading to enhanced profit, margins, and returns despite cost pressures, and building the strongest-ever balance sheet for future growth and value creation - 2022 performance reflects outstanding employee commitment, underlying strength and resilience of the business, and continued execution of the integrated solutions strategy[27] - Achieved further improvements in profit, margins, and returns despite significant cost pressures throughout the year[27] - Strong cash generation and continued focus on disciplined capital allocation resulted in the strongest balance sheet in the company's history, providing significant opportunities for future growth and value creation[27] Financial Performance Overview Group Financial Highlights CRH achieved significant financial growth in 2022, with double-digit increases in group sales and EBITDA, and substantial improvements in profit after tax from continuing operations and EPS, demonstrating effective management in addressing cost inflation 2022 Group Financial Performance (Continuing Operations) | Metric | 2022 ($m) | 2021 ($m) | Change Rate | |:---------------------|:------------|:------------|:-------| | Group Sales | 32,700 | 29,200 | +12% | | Group EBITDA | 5,600 | 5,000 | +13% | | Profit After Tax from Continuing Operations | 2,700 | 2,400 | +10% | | EPS from Continuing Operations | 3.50 | 3.06 | +14% | | Total EPS | 5.07 | 3.29 | +54% | - Group sales increased by 12% year-on-year, and EBITDA increased by 13%, primarily due to good commercial management and operational efficiency, offsetting significant cost inflation[33] - Profit after tax from continuing operations increased by 10% compared to 2021, driven by strong trading performance[29] Segmental Performance Summary All business segments performed strongly in 2022, with Americas Materials and Building Products achieving significant sales and EBITDA growth, while Europe Materials also saw sales and EBITDA increases driven by pricing, despite adverse currency impacts - Americas Materials performed strongly, with total sales up 15%, like-for-like sales up 12%, and EBITDA up 6% (like-for-like up 5%), primarily due to robust price increases across all product lines[56] - Building Products maintained good activity levels, with total sales up 26%, like-for-like sales up 11%, and total EBITDA up 52% (like-for-like up 18%), driven by strong demand in key utility infrastructure and outdoor living solutions[56] - Europe Materials reported like-for-like sales growth of 11% and like-for-like EBITDA growth of 8%, reflecting sustained strong pricing progress offsetting lower activity levels, but total sales were flat compared to 2021, and EBITDA decreased by 4% due to adverse currency impacts[56] Strategic Initiatives & Outlook Integrated Solutions Strategy & Organizational Structure The company continues to advance its integrated solutions strategy by combining value-added materials, products, and services to meet increasingly complex customer construction needs, transitioning to a new organizational structure effective January 1, 2023, with two divisions and four reporting segments - 2022 performance reflects the continued execution of the company's integrated solutions strategy, which provides tailored solutions by combining value-added materials, products, and services for customers[58] - To accelerate strategic development and adapt to industry changes, the company transitioned to a new organizational structure effective January 1, 2023, comprising two divisions (CRH Americas and CRH Europe) and four reporting segments (Americas Materials Solutions, Americas Building Solutions, Europe Materials Solutions, and Europe Building Solutions)[38][58][169] Sustainability & Decarbonization The company is committed to continuously improving its sustainability performance and decarbonizing its operations, announcing an industry-leading absolute carbon emissions reduction target by 2030, validated by SBTi, and launching CRH Ventures with a $250 million fund for construction and climate technology investments - The company announced a target to achieve a 30% absolute reduction in carbon emissions by 2030 (from a 2021 base year), validated by the Science Based Targets initiative (SBTi), consistent with its 2050 net-zero target[59] - Launched CRH Ventures, a venture capital arm with a $250 million venture and innovation fund, to partner with construction and climate technology companies, supporting the development of new technologies and innovative solutions for customer needs and a sustainable built environment[36] Trading Outlook Despite macroeconomic uncertainties and persistent cost inflation, the company anticipates resilient demand and price increases in 2023, with North American operations benefiting from strong pricing and infrastructure demand, while Europe expects positive pricing momentum to offset volume declines - Resilient demand and price increases are anticipated for 2023, despite macroeconomic uncertainties and persistent cost inflation[37] - North American operations will benefit from strong pricing and significant increases in federal and state-level infrastructure funding[37] - The non-residential sector is supported by clean energy government funding and key manufacturing reshoring, while the residential new-build market will experience short-term weakness due to rising interest rates[37] - Europe anticipates positive pricing momentum to offset lower volumes, with Central and Eastern European construction activity supported by EU infrastructure funds, and Western European operations underpinned by resilient repair, maintenance, and improvement (RMI) activity and stable infrastructure demand[37] Segmental Performance Americas Materials Americas Materials delivered strong performance in 2022, with growth in both sales and EBITDA, primarily driven by robust price increases across all business lines, despite adverse weather and rising input costs, further consolidating its market position through acquisitions Americas Materials 2022 Financial Performance | Metric | 2021 ($m) | 2022 ($m) | Change Rate | |:-----------------|:------------|:------------|:-------| | Sales Revenue | 12,407 | 14,324 | +15% | | EBITDA | 2,588 | 2,748 | +6% | | Operating Profit | 1,788 | 1,909 | +7% | | EBITDA/Sales | 20.9% | 19.2% | -1.7pp | | Operating Profit/Sales | 14.4% | 13.3% | -1.1pp | - Sales increased by 15%, EBITDA by 6%, and operating profit by 7%, primarily driven by robust price increases across all business lines, partially offset by lower volumes due to adverse weather and rising input costs[39][62] - Completed 10 solutions-focused acquisitions in 2022, totaling $500 million in expenditure, with the largest being Hinkle Contracting Company in Kentucky[63] Product & Regional Performance Americas Materials achieved price increases across aggregates, asphalt, ready-mixed concrete, and cement product lines, offsetting some volume declines and cost inflation, with varied regional market performance due to weather and other factors - Aggregates volumes decreased by 1% but prices increased by 10%; asphalt volumes increased by 3% with prices up 20%; ready-mixed concrete volumes decreased by 6% but prices increased by 14%; cement volumes slightly decreased but prices increased by 12%[41][45][64][65] - Southern region sales increased by 26%, with volumes ahead of the prior year, but operating profit slightly decreased as strong pricing was offset by increased energy and asphalt costs[67] - Northeast region sales increased by 10%, with operating profit up, primarily due to price increases offsetting lower volumes and increased input costs[66] - Great Lakes sales increased by 20%, and Western region sales increased by 10%, primarily through commercial management and pricing strategies to counter cost inflation[43][44] Building Products Building Products achieved significant growth in 2022, with substantial increases in sales and operating profit, driven by strong demand in key utility infrastructure and outdoor living solutions, as well as contributions from successful acquisitions, further enhancing profitability through effective cost control and production efficiency improvements Building Products 2022 Financial Performance | Metric | 2021 ($m) | 2022 ($m) | Change Rate | |:-----------------|:------------|:------------|:-------| | Sales Revenue | 6,218 | 7,823 | +26% | | EBITDA | 992 | 1,510 | +52% | | Operating Profit | 729 | 1,161 | +59% | | EBITDA/Sales | 16.0% | 19.3% | +3.3pp | | Operating Profit/Sales | 11.7% | 14.8% | +3.1pp | - Sales increased by 26% (like-for-like up 11%), EBITDA by 52% (like-for-like up 18%), and operating profit by 59% (like-for-like up 20%), primarily due to strong demand in key utility infrastructure and outdoor living solutions, coupled with sustained cost control and production efficiency[46] - Completed 10 acquisitions in 2022, primarily in the US, totaling approximately $2.7 billion in expenditure, with the largest being Barrette Outdoor Living, a leading North American provider of fencing and railing solutions[69] Product Performance Building Products' sub-categories performed well, with sales growth in architectural products across North America and Europe, strong demand for infrastructure products, and leading sales in building envelope solutions through aggressive pricing, while the divested Building Envelope business also grew sales and EBITDA prior to its divestment - North American architectural products sales grew strongly, with robust performance in Europe despite currency headwinds; integration of Barrette Outdoor Living is progressing well[70] - Infrastructure products sales grew strongly, particularly in North America, benefiting from strong demand in communications, energy, water, and transportation sectors, and contributions from recent acquisitions[71] - Building envelope solutions achieved leading sales across all regions through aggressive pricing actions, with operating profit significantly ahead of the prior year[91] - The Building Envelope business (divested) reported sales and EBITDA ahead of 2021 prior to its divestment in April 2022, benefiting from sales growth and margin expansion from operational efficiencies[92] Europe Materials Europe Materials successfully offset significant energy and other input cost inflation, as well as the impact of the conflict in Ukraine, through commercial management and cost-saving initiatives in 2022, resulting in like-for-like sales and EBITDA growth, despite adverse currency translation effects on total sales and EBITDA Europe Materials 2022 Financial Performance | Metric | 2021 ($m) | 2022 ($m) | Change Rate | |:-----------------|:------------|:------------|:-------| | Sales Revenue | 10,581 | 10,576 | - | | EBITDA | 1,410 | 1,357 | -4% | | Operating Profit | 814 | 824 | +1% | | EBITDA/Sales | 13.3% | 12.8% | -0.5pp | | Operating Profit/Sales | 7.7% | 7.8% | +0.1pp | - Like-for-like sales grew by 11%, like-for-like EBITDA by 8%, and operating profit like-for-like by 12%, primarily due to sustained strong pricing progress and cost-saving initiatives[93] - Adverse currency translation effects resulted in total sales being flat compared to 2021, EBITDA decreasing by 4%, and operating profit increasing by 1%[93] Regional Performance Europe Materials' performance varied across regions, with strong sales and operating profit in the UK and Ireland, flat sales but growing operating profit in Northern Europe, and slight sales decline but like-for-like operating profit growth in Western Europe, while Eastern Europe's sales were ahead despite the Ukraine conflict impacting total operating profit, and Asian regions saw lower sales and operating profit due to construction restrictions and cost inflation - UK and Ireland sales and operating profit significantly exceeded 2021, driven by strong pricing and ongoing performance optimization[49] - Northern Europe (Finland, Germany, and Switzerland) sales were flat compared to 2021, primarily due to price increases offsetting volume declines, with like-for-like operating profit ahead[72] - Western Europe (France, Benelux, Denmark, and Spain) sales were slightly below 2021, but like-for-like operating profit was ahead, benefiting from higher pricing and sustained cost savings[94] - Eastern Europe (Poland, Ukraine, Romania, Hungary, Slovakia, Serbia, and Croatia) sales were ahead, but the Ukraine conflict impacted activity levels, leading to total operating profit being below the prior year[73] - Philippines sales lagged 2021, with operating profit significantly impacted by high energy and transportation costs; performance of Chinese associates was affected by COVID-19 restrictions[95][97] Other Financial Items Depreciation, Tax & Finance Costs Depreciation and amortization expenses in 2022 were flat compared to the prior year, profit before tax increased, but the effective tax rate rose due to the tax impact of divested businesses, while net finance costs decreased, primarily benefiting from higher interest income and lower debt levels - Total depreciation and amortization expenses were $1.7 billion, flat compared to the prior year (2021: $1.7 billion)[52] - Profit before tax was $3.5 billion (2021: $3.1 billion), with related tax expenses of $785 million (2021: $661 million), resulting in an effective tax rate of 22.6% (2021: 21.3%), higher than the prior year, primarily due to the tax impact of divested businesses[53] - Net finance costs were $376 million, lower than $399 million in 2021, primarily due to increased interest income and lower debt levels offsetting higher interest expenses from rising interest rates[74] Disposals & Equity Accounted Investments Disposals from continuing operations resulted in a total loss of $49 million, while the divestment of the Building Envelope business generated a profit after tax of $1.1 billion, and profit from equity-accounted investments was zero, mainly due to the impact of COVID-19 restrictions on Chinese associates' performance - Disposals and asset sales from continuing operations resulted in a total loss of $49 million (2021: $116 million profit)[96] - Profit after tax from the divestment of the Building Envelope business was $1.1 billion, recognized in profit after tax from discontinued operations[96] - Profit from equity-accounted investments was zero (2021: $55 million), primarily due to the impact of COVID-19 restrictions on Chinese associates' performance[97] Shareholder Returns Dividend Policy & Declaration The Board recommends a final dividend of $1.03 per share, bringing the total annual dividend to $1.27 per share, a 5% increase from 2021, consistent with the company's progressive dividend policy, with payments to be made entirely in cash - The Board recommends a final dividend of $1.03 per share, bringing the total annual dividend to $1.27 per share (2021: $1.21 per share), an increase of 5.0% from 2021, consistent with the company's progressive dividend policy[98] - Dividend cover was 2.8x based on EPS from continuing operations[98] - The final dividend will be paid on May 4, 2023, to shareholders registered at the close of business on March 17, 2023, with an ex-dividend date of March 16, 2023, and will be paid entirely in cash[98] Share Buyback Programme The company continued its share buyback program in 2022, repurchasing 29.8 million ordinary shares for a total consideration of $1.2 billion, and plans to significantly increase its share buyback program to up to $3.0 billion of CRH shares over the next 12 months, given its strong financial position and cash generation - The company continued its share buyback program in 2022, repurchasing 29.8 million ordinary shares (2021: 17.8 million shares) for a total consideration of $1.2 billion (2021: $0.9 billion)[99] - The company plans to significantly increase its share buyback program to up to $3.0 billion of CRH shares over the next 12 months, to return value to shareholders while maintaining financial flexibility for investment growth[75][100] Balance Sheet and Liquidity Financial Position & Debt Metrics At the end of 2022, the company held $5.9 billion in cash and cash equivalents, along with $3.7 billion in undrawn committed credit facilities, ensuring debt repayment capacity for the next five years, with year-end net debt at $5.1 billion and a net debt/EBITDA ratio of 0.9x, indicating a strong financial position and investment-grade credit ratings - At year-end 2022, the Group held $5.9 billion in cash and cash equivalents, and $3.7 billion in undrawn committed credit facilities, available until 2026[76] - Year-end net debt was $5.1 billion (2021: $6.3 billion), with a net debt/EBITDA ratio of 0.9x (2021: 1.3x), reflecting healthy operating cash inflows and proceeds from divestments[101][229] - The Group maintains a robust balance sheet and strong investment-grade credit ratings, achieving BBB+ or equivalent from all three rating agencies[102] - The weighted average remaining debt maturity was 12.2 years, with sufficient cash balances to meet all debt obligations maturing over the next five years[76] Investments and Divestments Acquisitions In 2022, the company invested $3.3 billion in 29 acquisitions, the largest being the $1.9 billion acquisition of Barrette Outdoor Living, a leading North American provider of fencing and railing solutions, to enhance its outdoor living solutions portfolio, with Americas Materials and Europe Materials segments also completing several solutions-focused acquisitions - In 2022, the Group invested $3.3 billion in 29 acquisitions (including deferred and contingent consideration for prior acquisitions)[77][103] - The largest acquisition was the Building Products segment's $1.9 billion purchase of Barrette Outdoor Living, a leading North American provider of fencing and railing solutions, to enhance its sustainable outdoor living solutions portfolio[77] - Americas Materials segment completed 10 solutions-focused acquisitions totaling $500 million in expenditure; Europe Materials segment completed 9 bolt-on acquisitions totaling $100 million in expenditure[77] Divestments In 2022, the company completed nine transactions, generating total proceeds of $3.9 billion from business and asset disposals, primarily from the divestment of the Building Envelope business, which yielded $3.5 billion in cash proceeds - In 2022, the Group completed 9 transactions, generating total proceeds of $3.9 billion from business and asset disposals, primarily related to the divestment of the Building Envelope business[103] - The largest divestment was the Building Envelope business, which generated $3.5 billion in cash proceeds (enterprise value of $3.8 billion, including $300 million of transferred lease liabilities)[104] - Additionally, the Group completed 8 other divestments, generating total proceeds of $200 million, and received $100 million from the disposal of remaining property, plant, and equipment and other non-current assets[104] Listing Considerations Rationale for US Primary Listing North American operations currently account for approximately 75% of the Group's EBITDA and are expected to be a key driver of CRH's future growth, with the company believing a US primary listing will provide more commercial, operational, and acquisition opportunities, further accelerating its integrated solutions strategy and delivering higher profitability, returns, and cash for shareholders, without affecting CRH plc's headquarters, place of incorporation, or tax residency in Ireland - North American operations currently account for approximately 75% of Group EBITDA and are expected to be a key driver of CRH's future growth, with potential for further increased exposure in this market due to significant increases in infrastructure funding, manufacturing reshoring, and undersupply in the residential construction market[79] - The company believes a US primary listing will provide more commercial, operational, and acquisition opportunities, further accelerating its integrated solutions strategy and delivering higher profitability, returns, and cash for shareholders[80] - This change in listing structure will not affect CRH plc's headquarters, place of incorporation, or tax residency in Ireland[81] - The company will present the rationale for the recommended US primary listing to shareholders in the coming weeks and will provide further updates in its trading statement on April 26, 2023[106][107] Primary Financial Statements Consolidated Income Statement The 2022 consolidated income statement shows growth in both group revenue and profit, with significant improvements in profit after tax from continuing operations and EPS, though losses from disposed businesses had some impact on total profit Consolidated Income Statement Summary (2022 vs 2021) | Metric | 2022 ($m) | 2021 ($m) | |:-----------------------------------|:------------|:------------| | Revenue | 32,723 | 29,206 | | Cost of Sales | (21,844) | (19,350) | | Gross Profit | 10,879 | 9,856 | | Operating Costs | (6,985) | (6,525) | | Group Operating Profit | 3,894 | 3,331 | | Profit/(Loss) on Disposals | (49) | 116 | | Profit Before Tax from Continuing Operations | 3,469 | 3,103 | | Income Tax Expense | (785) | (661) | | Profit After Tax from Continuing Operations | 2,684 | 2,442 | | Profit After Tax from Discontinued Operations | 1,190 | 179 | | Group Profit for the Year | 3,874 | 2,621 | | Basic EPS from Continuing Operations | $3.50 | $3.06 | | Diluted EPS from Continuing Operations | $3.48 | $3.03 | | Basic EPS | $5.07 | $3.29 | | Diluted EPS | $5.03 | $3.26 | Consolidated Statement of Comprehensive Income The consolidated statement of comprehensive income shows a group profit for the year of $3.874 billion in 2022, with other comprehensive income of negative $373 million, resulting in a total comprehensive income for the year of $3.501 billion Consolidated Statement of Comprehensive Income Summary (2022 vs 2021) | Metric | 2022 ($m) | 2021 ($m) | |:-----------------------------------|:------------|:------------| | Group Profit for the Year | 3,874 | 2,621 | | Other Comprehensive Income | (373) | (84) | | - Items that may be reclassified to profit or loss in subsequent periods | (589) | (312) | | - Items that will not be reclassified to profit or loss in subsequent periods | 216 | 228 | | Total Comprehensive Income for the Year | 3,501 | 2,537 | Consolidated Balance Sheet As of December 31, 2022, total group assets slightly increased, non-current assets remained stable, and current assets rose, while total liabilities decreased, primarily due to a reduction in non-current liabilities, with shareholder equity growing significantly, reflecting the company's robust financial position Consolidated Balance Sheet Summary (2022 vs 2021) | Metric | 2022 ($m) | 2021 ($m) | |:---------------------|:------------|:------------| | Assets | | | | Total Non-Current Assets | 30,387 | 30,626 | | Total Current Assets | 14,801 | 14,044 | | Total Assets | 45,188 | 44,670 | | Liabilities | | | | Total Non-Current Liabilities | 13,962 | 16,175 | | Total Current Liabilities | 8,889 | 7,581 | | Total Liabilities | 22,851 | 23,756 | | Equity | | | | Equity Attributable to Company Shareholders | 21,691 | 20,233 | | Non-Controlling Interests | 646 | 681 | | Total Equity | 22,337 | 20,914 | Consolidated Statement of Changes in Equity The consolidated statement of changes in equity details various changes in shareholder equity in 2022, including group profit, other comprehensive income, share buybacks, dividend payments, and other adjustments, ultimately leading to an increase in total equity from $20.914 billion at year-end 2021 to $22.337 billion at year-end 2022 - Total equity was $20.914 billion on January 1, 2022, and increased to $22.337 billion by December 31, 2022[135] - Changes in equity primarily include group profit for the year of $3.874 billion, other comprehensive income of negative $373 million, as well as share buybacks ($1.153 billion) and dividend payments ($944 million)[135] Consolidated Statement of Cash Flows The consolidated statement of cash flows shows net cash inflow from operating activities of $3.954 billion, net cash outflow from investing activities of $884 million, and net cash outflow from financing activities of $2.686 billion in 2022, ultimately leading to a $384 million increase in cash and cash equivalents, despite a slight decrease in operating cash inflow Consolidated Statement of Cash Flows Summary (2022 vs 2021) | Metric | 2022 ($m) | 2021 ($m) | |:---------------------------|:------------|:------------| | Net Cash Inflow from Operating Activities | 3,954 | 4,210 | | Net Cash Outflow from Investing Activities | (884) | (2,546) | | Net Cash Outflow from Financing Activities | (2,686) | (3,305) | | Increase/(Decrease) in Cash and Cash Equivalents | 384 | (1,641) | | Cash and Cash Equivalents at Year-End | 5,936 | 5,783 | - Net cash inflow from operating activities was $3.954 billion, and excluding increased tax outflows related to the Building Envelope divestment, operating cash inflow was higher than in 2021[101][112] - Net cash outflow from investing activities significantly decreased, primarily due to proceeds from business disposals ($3.827 billion), offsetting expenditures for subsidiary acquisitions ($3.253 billion) and property, plant, and equipment purchases ($1.523 billion)[89][112] - Net cash outflow from financing activities primarily included share buybacks ($1.178 billion) and dividend payments ($917 million)[89] Selected Explanatory Notes to the Consolidated Financial Statements Basis of Preparation and Accounting Policies The financial information in this report is prepared in accordance with International Financial Reporting Standards (IFRS), with no material impact from 2022 standard revisions, and a voluntary change in operating cash flow presentation from January 1, 2022, had no impact on net cash inflow - Financial information is prepared in accordance with International Financial Reporting Standards (IFRS)[114] - Revisions to standards effective January 1, 2022 (including amendments to IFRS 3, IAS 16, IAS 37, and annual improvements), had no material impact on the Group's performance[115] - The company voluntarily changed its accounting policy for presenting operating cash flow in the consolidated statement of cash flows from January 1, 2022, using "Group profit for the year" as the starting point, but this had no impact on net cash inflow or any other financial statement items[116] Translation of Foreign Currencies The Group presents financial information in US Dollars, with results and cash flows of non-USD functional currency operations translated at annual average exchange rates, and the balance sheet translated at year-end exchange rates, with the report providing 2022 and 2021 average and year-end exchange rates for major currencies against the US Dollar - Financial information is presented in US Dollars, with results and cash flows of non-USD functional currency operations translated at annual average exchange rates, and the balance sheet translated at year-end exchange rates[117] Major Foreign Currency Exchange Rates vs USD (2022 vs 2021) | Currency | 2022 Average Rate | 2021 Average Rate | 2022 Year-End Rate | 2021 Year-End Rate | |:-----------------|:---------------|:---------------|:-------------|:-------------| | Brazilian Real | 5.1648 | 5.3968 | 5.2794 | 5.5716 | | Canadian Dollar | 1.3017 | 1.2538 | 1.3535 | 1.2716 | | Euro | 0.9518 | 0.8460 | 0.9368 | 0.8829 | | Pound Sterling | 0.8120 | 0.7270 | 0.8310 | 0.7417 | | Swiss Franc | 0.9551 | 0.9145 | 0.9230 | 0.9119 | | Ukrainian Hryvnia | 32.6730 | 27.2588 | 36.9172 | 27.2850 | Key Components of 2022 Performance & Seasonality The growth in 2022 performance was primarily driven by a combination of organic growth, acquisition contributions, and exchange rate impacts, with the construction industry exhibiting seasonal characteristics and weather dependency, resulting in a lower proportion of full-year sales and EBITDA recognized in the first half 2022 Performance Change Analysis (Continuing Operations) | Metric | 2021 ($m) | FX Impact ($m) | 2021/2022 Acquisition Increments ($m) | 2021/2022 Divestment Decrements ($m) | Organic Growth ($m) | 2022 ($m) | Total Change Rate | Organic Change Rate | |:-----------------|:------------|:--------------|:-----------------------|:-----------------------|:--------------|:------------|:---------|:-----------| | Sales Revenue | 29,206 | (1,359) | 1,739 | (108) | 3,245 | 32,723 | 12% | 12% | | EBITDA | 4,990 | (168) | 402 | (17) | 408 | 5,615 | 13% | 8% | | Operating Profit | 3,331 | (82) | 275 | (13) | 383 | 3,894 | 17% | 12% | | Profit Before Tax | 3,103 | (68) | 220 | (143) | 357 | 3,469 | 12% | 12% | - The construction industry is cyclical and seasonal, affected by weather, with 46% of full-year sales (2021: 45%) and 39% of full-year EBITDA (2021: 36%) recognized in the first half[119] Revenue Disaggregation Group revenue is disaggregated by major geographical markets and by major activities and products, with the United States being the largest revenue source, followed by the UK and other European regions, and construction contract activities, aggregates/asphalt/ready-mixed products, and cement/lime products serving as primary revenue sources Revenue by Major Geographical Market (2022 vs 2021) | Geographical Market | 2022 ($m) | 2021 ($m) | |:-----------------|:------------|:------------| | United States | 19,088 | 15,618 | | United Kingdom | 4,241 | 4,199 | | Rest of Europe | 6,293 | 6,316 | | Republic of Ireland | 801 | 706 | | Rest of World | 2,300 | 2,367 | | Total Continuing Operations | 32,723 | 29,206 | | Total Discontinued Operations | 645 | 1,775 | Revenue by Major Activity and Product (2022 vs 2021) | Activity and Product | 2022 ($m) | 2021 ($m) | |:-------------------|:------------|:------------| | Construction Contract Activities | 7,980 | 6,819 | | Building Products | 5,717 | 5,054 | | Infrastructure Products | 2,702 | 1,788 | | Building Envelope Solutions | 795 | 731 | | Cement, Lime & Cement Products | 5,035 | 4,946 | | Aggregates, Asphalt & Ready-Mixed Products | 10,494 | 9,868 | | Total Continuing Operations | 32,723 | 29,206 | | Total Discontinued Operations | 645 | 1,775 | - As of December 31, 2022, unrecognised long-term construction contract revenue was $3.742 billion (2021: $3.177 billion), with the majority expected to be recognized within 12 months[148] Segment Information The Group reorganized into CRH Americas and CRH Europe divisions on January 1, 2023, and increased its reporting segments, with Americas Materials, Building Products, and Europe Materials serving as primary reporting segments in 2022, with detailed disclosures of their revenue, EBITDA, depreciation, amortization, and operating profit - Effective January 1, 2023, the Group reorganized into two divisions, CRH Americas and CRH Europe, increasing reporting segments from three to four: Americas Materials Solutions, Americas Building Solutions, Europe Materials Solutions, and Europe Building Solutions[169] - Changes in segmental reporting have no financial impact on the Group's consolidated financial statements[170] Revenue, EBITDA, Depreciation, Amortization & Operating Profit by Segment (2022 vs 2021) | Metric | Segment | 2022 ($m) | Share (%) | 2021 ($m) | Share (%) | |:-------------------------|:-----------------|:------------|:---------|:------------|:---------| | Revenue | Americas Materials | 14,324 | 43.8 | 12,407 | 42.5 | | | Building Products | 7,823 | 23.9 | 6,218 | 21.3 | | | Europe Materials | 10,576 | 32.3 | 10,581 | 36.2 | | EBITDA | Americas Materials | 2,748 | 48.9 | 2,588 | 51.9 | | | Building Products | 1,510 | 26.9 | 992 | 19.9 | | | Europe Materials | 1,357 | 24.2 | 1,410 | 28.2 | | Depreciation, Amortization & Impairment | Americas Materials | 839 | 48.7 | 800 | 48.2 | | | Building Products | 349 | 20.3 | 263 | 15.9 | | | Europe Materials | 533 | 31.0 | 596 | 35.9 | | Group Operating Profit | Americas Materials | 1,909 | 49.0 | 1,788 | 53.7 | | | Building Products | 1,161 | 29.8 | 729 | 21.9 | | | Europe Materials | 824 | 21.2 | 814 | 24.4 | Segment Assets & Liabilities (2022 vs 2021) | Metric | Segment | 2022 ($m) | Share (%) | 2021 ($m) | Share (%) | |:-----------------|:-----------------|:------------|:---------|:------------|:---------| | Total Assets | Americas Materials | 17,609 | 45.8 | 17,064 | 45.0 | | | Building Products | 9,165 | 23.9 | 8,504 | 22.4 | | | Europe Materials | 11,622 | 30.3 | 12,367 | 32.6 | | Total Liabilities | Americas Materials | 3,227 | 33.9 | 3,292 | 33.0 | | | Building Products | 2,045 | 21.5 | 2,579 | 25.9 | | | Europe Materials | 4,245 | 44.6 | 4,100 | 41.1 | Earnings per Ordinary Share In 2022, the company's basic and diluted EPS from continuing operations both increased, while total EPS significantly rose due to the profit contribution from discontinued operations Earnings per Ordinary Share (2022 vs 2021) | Metric | 2022 ($) | 2021 ($) | |:-----------------------------------|:-----------|:-----------| | Basic EPS from Continuing Operations | 3.50 | 3.06 | | Diluted EPS from Continuing Operations | 3.48 | 3.03 | | Basic EPS | 5.07 | 3.29 | | Diluted EPS | 5.03 | 3.26 | - Profit attributable to ordinary shareholders (numerator for basic/diluted EPS) was $3.847 billion (2021: $2.565 billion)[171] - Profit after tax from discontinued operations attributable to company shareholders was $1.190 billion (2021: $179 million)[171] Dividends The Board recommends a final dividend of $1.03 per share, bringing the total annual dividend to $1.27 per share, a 5% increase from the prior year, with payments to be made in Euros, Pound Sterling, and US Dollars according to shareholders' existing instructions Dividend Information (2022 vs 2021) | Metric | 2022 ($) | 2021 ($) | |:---------------------|:-----------|:-----------| | Net Dividend Paid Per Share | 1.22 | 1.16 | | Net Dividend Declared Per Share | 1.27 | 1.21 | | Dividend Cover from Continuing Operations | 2.8x | 2.5x | - The Board recommends a final dividend of $1.03 per share, bringing the total annual dividend to $1.27 per share, a 5% increase from the prior year[174] - The final dividend will be paid in Euros, Pound Sterling, and US Dollars according to shareholders' existing payment instructions, with exchange rates expected to be determined on April 20, 2023[154][175] Assets Held for Sale and Discontinued Operations In April 2022, the Group completed the divestment of its Building Envelope business, which was classified as a discontinued operation, generating a profit of $1.471 billion and proceeds from disposal of $3.525 billion, with cash flow from discontinued operations in 20