Building materials group CRH said that 2020 was a challenging year for the company due to significant Covid-19 related disruption in both Europe and North America.
CRH said its overall sales dipped 2% to $27.6 billion from $28.1 billion in 2019, but its profit after tax rose by 18% to $2 billion from $1.7 billion the previous year.
The world's second-biggest building materials supplier said that like-for-like sales in Americas Materials declined by 3% compared to 2019, mainly impacted by Covid-19 restrictions, project delays in some of its key states and unfavourable weather in the first half of the year.
Its Europe Materials saw a recovery in the second half of the year along with good price discipline.
But this did not fully mitigate the negative impact of Covid related shutdowns earlier in the year and like-for-like sales finished 5% behind 2019.
CRH said its Building Products division was boosted by strong residential repair, maintenance and improvement (RMI) activity in North America, offsetting lower activity levels in non-residential markets.
The division delivered like-for-like sales 4% ahead of 2019.
CRH said it was recommending a final dividend of 93 cent per share, resulting in a total dividend of 115 cent for the year. This marked an increase of 25% over 2019 and 37 years of dividend delivery, the company said.
The company also said it intends to restart its share buyback programme after a pause in response to high levels of market volatility in 2020, with another tranche of up to $0.3 billion to be completed by June.
"In addition, our significant balance sheet capacity offers flexibility to capitalise on our strong acquisition pipeline and deliver further value to shareholders as visibility improves," CRH added.
Albert Manifold, CRH's chief executive, said that through the repositioning of the business in recent years and its relentless focus on continuous business improvement, CRH had delivered record levels of profitability, margins and cash generation.
"Although the near-term outlook remains uncertain, our unique portfolio of businesses together with the strength of our balance sheet leaves us well positioned to capitalise on the growth opportunities that lie ahead," the CEO added.
CRH said today that it will resume share buybacks and said it was looking for bigger acquisitions, buoyed by a 5% rise in full year earnings and record cash generation.
CRH launched its first buyback programme in a decade in 2018 and had bought €1.8 billion worth of stock before pausing it when the Covid-19 pandemic struck last year.
It said that it intended to buy up to €300m of shares by the end of June after reporting full-year year core earnings of $4.6 billion. This compared with a November earnings forecast of more than $4.4 billion.
Senan Murphy, CRH's chief financial officer, told Reuters that the world's largest buyer of cement would look at further buybacks each quarter, but that would also depend on how much cash it decides to spend on acquisitions.
The group said that its pipeline of possible deals is strong and Senan Murphy said that could include medium-size acquisitions as well as the smaller firms CRH has routinely acquired each year.
CRH said in its earnings statement that it expects recovery to continue across its main markets of Europe and North America as Covid-19 vaccines are rolled out, but cautioned that the 2021 outlook remained unclear.
"We still remain uncertain as to what level of activities we'll get back to in all of our markets," Murphy said.
"If you look at non-residential activity, office, retail and some of those sectors, there is a level of uncertainty over them and there is probably going to be a lack of investment in the short term," he added.
Breaking down its divisions, CRH said that revenues in its Americas Materials unit fell by 3% to €11.273 billion, but operating profits rose by 15% to $1.631 billion.
CRH said that Covid-19 restrictions negatively impacted sales volumes in the second quarter, particularly in the North division, with sales in the South division impacted by project delays in key states.
It said that overall economic and construction activity across its markets was impacted by the global pandemic, but noted that government stimulus to help support the US economy was implemented.
During the year, Americas Materials completed seven acquisitions in the US and Canada including aggregates, asphalt, readymixed concrete, paving and construction operations at a total cost of $163m.
Sales revenues at CRH's Europe Materials division fell by 4% to $9.141 billion while operating profits slumped by 131% to $190m as the recovery in the second half of the year could not fully mitigate the significant impact of Covid-19 related restrictions in the second quarter.
It said that overall sales, EBITDA and operating performance finished below 2019 levels as strong performances in its Eastern European businesses were offset by a more challenging backdrop in a number of countries across Western Europe.
Meanwhile, sales revenues at CRH's Building Products division rose by 3% to $7.173 billion while operating profits were up 10% to $822m. It said that strong residential RMI demand, especially in North America, more than offset the effect of a more subdued non-residential sector.
Shares in the company moved higher in Dublin trade today.
