CRH SAYS 2009 WILL BE CHALLENGING - A trading update from CRH this morning says it expects to deliver 2008 profit before tax in excess of €1.6 billion. This would represent a mid-teen percentage decline on the total for 2007 and is what analysts had expected. CRH says that the outlook for 2009 is extremely challenging.
Separately, the group says said it spent €273m on 16 acquisitions and investments in the second half of 2008. That is much less than the total spent in the first half of the year, in the light of the deteriorating economic environment. The company operates in 34 countries, employing approximately 92,000 people. It has been less affected than most by the downturn in the Irish and global economies. The company's shares were down only 25% in 2008. And though it was always one of the big ones on the stock exchange, at €10 billion, it is now worth more than all of the listed banks put together.
The company's new chief executive Myles Lee says that the predicted profits forecast represents a significant achievement against a tough industry backdrop. Mr Lee says all of the various financial failures in September, including the collapse of Lehman Brothers, had a big impact on confidence worldwide. It also led to a significant tightening of credit, which in turn impacted on a lot of commercial activity.
The CRH CEO says that its US businesses are roughly split three ways - a third residential, a third non-residential and the remaining one third infrastructure. He says he is expecting a significant stimulus plan from the incoming administration to the country's infrastructure sector in 2009 and into 2010.
In Europe, the bright spot continues to be in Poland, where the government there has major EU structural funds to put to use on the development of its roads, water and sewage systems. He says that CRH expects to see more significant activity on that front in 2009.
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MORNING BRIEFS - Anglo Irish Bank says its Annual General Meeting will be held on Wednesday February 25 in Dublin's Mansion House. Its EGM will be held next week, where details of the bank's recapitalisation will be considered. In a statement this morning the bank's board said it welcomes the government's capital investment in Anglo. It says it believes that this investment, together with the Government's stated commitment to reinforce the position of the bank through making further capital available if required so that it remains a sound and viable institution, represent very positive developments for Anglo Irish Bank.
*** According to reports, three US based parties are in talks to save Waterford Wedgwood after receivers were appointed to the company yesterday and its shares were suspended in Dublin. The FT says accounting firm Deloitte, acting as Waterford's receivers, is in talks with three US parties about selling the majority of its assets.
*** Marks and Spencer is to cut over 1,000 jobs in its shops, its head office and support functions following 'disastrous' Christmas trading. The chain is set to announce the cuts tomorrow, when it releases a trading update to the London Stock Exchange. The news comes as the remaining Woolworths shops close their doors today.
*** Chrysler says its US sales fell by 53% in December from a year earlier. Overall for 2008 Chrysler sales were down 30%. Ford saw its monthly US sales fall 32%, while General Motors sales dropped 31% when compared with December 2007.
*** Fashion chain Next said today it had made a 'good start' to post-Christmas sales despite further trading declines in the run-up to the festive season. Sales fell 7 per cent between the end of July and Christmas Eve. The chain runs about 480 shops in the UK and Ireland.
*** Debenhams said that profits were up on last year after the department store chain achieved what it called a 'creditable' Christmas trading performance. The group, which has 153 stores in the UK and Ireland, reported a 3.3% drop in sales for the 12 weeks since October 21. However, this compared with a decline of 4.2% for the previous six weeks.
*** On the currency markets, the euro is trading at $1.3521 cents and 92.59 pence sterling.
