Building materials group CRH said this morning it expected first half pre-tax profits to drop to a range of €155m to €160m, down from €196m for the same period last year.
In a move towards improving investor relations by issuing trading statements, CRH said that a weaker dollar and unfavourable weather conditions were accounting for some of the shortfall, with currency translation effects accounting for about €10m of the shortfall.
At its Irish operations, CRH said that residential construction has been particularly buoyant resulting in double-digit percentage increases in cement, concrete blocks and readymixed volumes.
Activity on major infrastructural projects under the National Development Plan continued at a good pace through the first six months, the firm said, though completion of a number of major projects has resulted in a small decline in blacktop volumes compared with 2002.
CRH's UK concrete activities enjoyed good demand and the firm expects to report improved first half profits as does its insulation business. In the Materials Division, residential demand in Northern Ireland continues at a reasonable level and, after a slow start, road maintenance activity has picked up in recent months.
Trading patterns in Mainland Europe in the first half of 2003 have been generally weak exacerbated by an exceptionally cold first quarter in northeastern Europe.
In the US materials division, overall state lettings have continued at a stable level and order books are good the firm said. But the products and distribution division was impacted by poor weather which has restricted both residential and non-residential construction activity and product shipments.
The company said the second half of the year is usually significantly more profitable for CRH than the first six months, mainly due to the second half bias in the activity levels and profitability of its US operations.
CRH, which is one of the world's four largest building materials firms, said it expected full year profit before tax to be ahead of last year given a return to normal weather for the remainder of 2003 and constant foreign exchange rates.
CRH shares closed 40 cent higher at €13.65 in Dublin this evening.
