2009 Annual Report - CRH

Europe Products & Distribution
Throughout 2009, tough markets across all
sectors where our businesses operate resulted
in a decline in operating profit. The management
team responded vigorously to the challenge
taking radical and effective action to mitigate
these effects. We continue to focus on
commercial initiatives, cost reduction and
performance improvement plans across all
our businesses.
Operations Review
Máirtín Clarke
Managing Director
Europe Products & Distribution
The squeeze on credit and falling consumer confidence hit the housing sector across
all regions. Non-residential activity also declined. The repair, maintenance and
improvement sectors were more resilient. Overall, the Division saw sales decrease by
12%, EBITDA decline by 25% and operating profit decline 39%.
With few exceptions our businesses experienced volume and price pressure. Towards
year-end some improvement in UK brick deliveries was evident. While some degree of
stability has returned to markets in Europe, we expect trading in 2010 to be
challenging.
The Division carried on from 2008 with the implementation of significant cost
reduction actions. Capital expenditure was again cut back and tighter working capital
management yielded a very positive outcome on cash flow. Our focus continued on
defending margins and conserving cash throughout our businesses.
Results
% of
€ million Group 2009 2008 Change Organic Acquisitions Restructuring Impairments Exchange
Sales Revenue 38% 6,635 7,498 (863) (1,062) 191 – – 8
EBITDA* 27% 487 650 (163) (137) 16 (29) – (13)
Operating Profit* 26% 253 418 (165) (129) 10 (29) (7) (10)
Average Net Assets 3,877 4,096
EBITDA Margin 7.3% 8.7%
Operating Profit Margin 3.8% 5.6%
* EBITDA and Operating Profit exclude profit on disposal
of non-current assets
Analysis of Change
CRH 25