CRH increased its full year dividend by 15% today after strong organic growth and the impact of a major acquisition drove profits 25% higher year-on-year at the cash rich building group.
CRH is the world's second-biggest building materials supplier by market value.
It reported core earnings of €4.2 billion, the first full year that it has benefited from its $3.5 billion acquisition of US cement maker Ash Grove Cement.
Excluding the contributions from recent acquisitions and currency fluctuations, like-for-like earnings grew by 7%. CRH had flagged in November that it expected earnings in excess of €4.15 billion.
CRH, which embarked on its first share buyback programme in a decade in 2018 and generated €3.5 billion of cash last year, announced a full year dividend of 85 euro cents per share, up 15% year-on-year.
That compared to a 6% increase in the dividend in 2018 and 5% increase in 2017
"15% is a big hike in terms of dividend and that really is a reflection of our confidence in the sustainability of both the profit and cash generation capability of the company going forward," CRH's Group Finance Director Senan Murphy said.
With the latest round of share buybacks running up until the end of March, Senan Murphy said CRH continued to consider the buybacks an ongoing programme.
The fresh record level of annual profits were driven by a 10% year-on-year rise in its Americas materials division, where CRH is the biggest producer of asphalt for highway construction.
Like-for-like earnings at its building products and Europe Materials divisions rose by 2% and 5%, respectively.
CRH provided a positive outlook for each of the three divisions as it forecast that 2020 "will be a year of further progress for the group."
During the year, CRH invested about €0.7 billion in 62 acquisition and investment transactions.
The largest acquisitions in 2019 included the November acquisition of Torrent Resources for about €75m., while CRH also bought Windsor Rock Products for €30m.
CRH also announced today that it has decided to change its reporting currency from the euro to the US Dollar effective from 1 January 2020.
It said that within its current portfolio of businesses, its euro denominated earnings - while sizeable - are a relatively lower proportion of overall earnings and the change to dollars will reduce the potential for foreign exchange volatility in its future reported earnings.
Albert Manifold, CRH's chief executive, said that the company delivered good profit growth in 2019 supported by positive momentum in its heritage businesses and strong contributions from recent acquisitions.
"With a continuing focus on margin expansion, cash generation and enhanced returns for shareholders, we believe that 2020 will be a year of further progress for the group," he added.
Breaking down its divisions, CRH said that its Americas Materials unit generated operating profit of €1.3 billion, 26% ahead of 2018. Sales revenue rose by 16% to €8,951 billion.
CRH said that headwinds driven by wet weather and increased raw materials costs in the first half of the year were offset by a stronger second-half performance reflecting increased volumes, positive pricing and reduced operating expenses.
Its Europe Materials also saw a positive year with good sales growth and particularly strong performances in Eastern Europe, the Philippines, France and Ireland.
Operating profit rose by 14% to €487m as price increases and a good contribution from performance improvement initiatives offset higher input costs and the impact of more challenging trading conditions in the UK.
Revenues the division rose by 6% to €8,042 billion.
CRH noted that its Irish sales and operating profit were well ahead of 2018 as the business benefited from continued market growth, underpinned by strong demand and some large projects in the Dublin region.
"Good volumes and price growth for all key products was achieved," it added.
Meanwhile, its Building Products division saw continued organic growth in 2019, with sales 2% ahead of 2018, while operating profit increased organically by 10% as a result of increased sales and continued emphasis on margins.
Shares in the company were lower in Dublin trade today.
