CRH Form 10-K 1
Forward Looking Statements – Safe Harbor Provisions Under The Private Securities Litigation Reform Act Of 1995
In order to utilize the “Safe Harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, CRH is providing the following cautionary statement.
This document contains statements that are, or may be deemed to be, forward-looking statements with respect to the financial condition, results of operations, business, viability and future performance of CRH and certain of the plans and objectives of CRH. These forward-looking statements may generally, but not always, be identified by the use of words such as “will”, “anticipates”, “should”, “could”, “would”, “targets”, “aims”, “may”, “continues”, “expects”, “is expected to”, “estimates”, “believes”, “intends” or similar expressions. These forward-looking statements include all matters that are not historical facts or matters of fact at the date of this document.
In particular, the following, among other statements, are all forward-looking in nature: plans and expectations regarding customer demand, pricing, costs, underlying drivers for growth in infrastructure, residential and non-residential activity, and macroeconomic and other trends in CRH’s markets, including onshoring, regulatory trends, and investment in technology, clean energy and manufacturing; plans and expectations regarding government funding initiatives and priorities, including the timing and amount of government funding and its effects on CRH’s business; plans and expectations regarding CRH’s strategy, expansionary capital expenditures, competitive advantages, growth opportunities, innovation, research and development and acquisitions and divestments, including the timing for completion, tax and accounting effects and expected commercial benefits; plans and expectations regarding the outcome of pending legal proceedings and provisions for environmental and remediation costs; plans and expectations regarding the timing and amount of share buybacks and dividends, including the Board’s policy of consistent long-term dividend growth; expectations regarding taxation of U.S. holders of our shares, including applicability of Irish Dividend Withholding Tax (DWT) and Irish stamp duty; expectations regarding the Company’s income tax reserves and returns; plans and expectations regarding equity incentive plans and pension plans; plans and expectations regarding CRH’s balance sheet, capital allocation, financial capacity, accounting policies, cash flows and working capital; expectations regarding CRH’s ability to fund its long-term contractual obligations, maturing debt obligations, capital expenditures; and other liquidity requirements, plans and expectations regarding the amortization of costs related to issuance of debt in 2023 and recognition of compensation expense related to the Share Option Schemes; plans and expectations regarding the expected benefits of CRH’s primary listing on the New York Stock Exchange (NYSE); plans and expectations regarding the effect of existing and future laws, rules and regulations on CRH’s business; plans and expectations regarding human capital initiatives, workplace safety, sustainability and climate change, CRH’s decarbonization targets, sustainability-related initiatives and business opportunities, including investments, and the delivery of and consumer demand for sustainable solutions and products; and plans and expectations regarding the potential impact and evolving nature of risks and CRH’s management of such risks.
By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future and reflect the Company’s current expectations and assumptions as to such future events and circumstances that may not prove accurate. You are cautioned not to place undue reliance on any forward-looking statements. These forward-looking statements are made as of the date of this document. The Company expressly disclaims any obligation or undertaking to publicly update or revise these forward-looking statements other than as required by applicable law.
A number of material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, certain of which are beyond our control, and which include, among other factors: economic and financial conditions, including changes in interest rates, inflation, price volatility and/or labor and materials shortages; demand for infrastructure, residential and non-residential construction and our products in geographic markets in which we operate; increased competition and its impact on prices and market position; increases in energy, labor and/or other raw materials costs; adverse changes to laws and regulations, including in relation to climate change; the impact of unfavorable weather; investor and/or consumer sentiment regarding the importance of sustainable practices and products; availability of public sector funding for infrastructure programs; political uncertainty, including as a result of political and social conditions in the jurisdictions CRH operates in, or adverse political developments, including the ongoing geopolitical conflicts in Ukraine and the Middle East; failure to complete or successfully integrate acquisitions or make timely divestments; cyber-attacks and exposure of associates, contractors, customers, suppliers and other individuals to health and safety risks, including due to product failures. Additional factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those expressed by the forward-looking statements in this report including, but not limited to, the risks and uncertainties described herein and in “Risk Factors” in Part 1, Item 1A of this Annual Report on Form 10-K for the year ended December 31, 2023 (the “Annual Report on Form 10-K”).
CRH Form 10-K 2
Item 1. Business
Overview
CRH is a leading provider of building materials solutions that build, connect and improve our world. In 2023, the Company generated $34.9 billion of revenues, $3.1 billion of net income and $6.2 billion of Adjusted EBITDA*.1Since formation in 1970, CRH has evolved from being a supplier of base materials to providing end-to-end value-added solutions that solve complex construction challenges for our customers. CRH works closely with the customer across the entire project lifecycle from planning, design, manufacture, installation and maintenance through to end-of-life recycling, using our engineering and innovation expertise to provide superior materials, products and services.
The Company integrates essential materials (aggregates and cement), value-added building products as well as construction services, to provide our customers with complete end-to-end solutions. CRH’s capabilities, innovation and technical expertise enable it to be a valuable partner for transportation and critical utility infrastructure projects, complex non-residential construction and outdoor living solutions.
CRH’s business addresses the needs of customers across infrastructure, non-residential and residential construction markets. In 2023, approximately 35% of revenues came from infrastructure (such as highways, streets, roads, bridges, and critical utility infrastructure), 30% from non-residential construction (including construction and maintenance of manufacturing, datacenter and distribution facilities) and 35% from residential construction. 55% of revenues came from sales to new-build construction, while 45% of revenues came from repair and remodel activity.
Operating in 29 countries, the Company has market leadership positions in North America and Europe. In 2023, 72% of net income and 73% of Adjusted EBITDA* was generated in North America. The United States is expected to be a key driver of future growth for CRH due to continued economic expansion, a growing population and significant public investment in construction. Our European business, which benefits from strong economic and construction growth prospects across Central and Eastern Europe as well as recurring repair and remodel demand in Western Europe, is an important strategic part of the Company and CRH intends to continue to expand its operations across the region. In both geographies there is significant government support for infrastructure and increasing demand for integrated solutions in major infrastructure and commercial projects.
CRH has a proven track record in value creation through acquisition which over the last decade has accounted for approximately two-thirds of the Company’s growth. We achieve this by acquiring businesses at attractive valuations and creating value by integrating them with our existing operations and generating synergies. The Company takes an active approach to portfolio management and continuously reviews the competitive landscape for attractive investment and divestiture opportunities to deliver further growth and value creation for shareholders. In 2023, CRH completed 22 acquisitions for a total consideration of $0.7 billion compared with $3.3 billion in 2022. The largest acquisition in 2023 was in our Americas Building Solutions segment where the Company completed the acquisition of Hydro International, a leading provider of stormwater and wastewater solutions in North America and Europe.
In 2023, CRH transitioned its primary stock exchange listing from the London Stock Exchange (LSE) to the NYSE. CRH currently maintains a primary listing on the NYSE and a standard listing on the LSE for its ordinary shares, each listing represented by the ticker symbol “CRH”. CRH believes that its NYSE primary listing will bring increased commercial, operational and acquisition opportunities for the Company, further accelerating its integrated solutions strategy and delivering even higher levels of profitability, cash and returns for its shareholders.
Customer Solutions
CRH’s differentiated strategy integrates building materials, products and services by providing them to customers as complete solutions that solve key challenges across the built environment.
Essential Materials
Essential Materials, consisting of aggregates and cement, are the foundation of CRH’s solutions strategy. Our vertically integrated businesses manufacture and supply these materials for use extensively in a wide range of construction applications, ranging from major road and infrastructure projects to the development and refurbishment of commercial buildings, private residences, public spaces and communities. Our deep materials and market knowledge, along with our extensive network of locations and assets, drives our performance and helps us deliver value to our customers. Customers typically range from national, regional and local governments to contractors and other construction product and service providers.
Road Solutions
CRH is a leading provider of solutions for sustainable road construction in North America and Europe. With our capabilities in manufacturing, installation, maintenance and circularity, we deliver a range of innovative solutions for our customers to better connect our communities, from major public highway infrastructure projects to residential roads, airports and parking lots. As responsible operators considerate of our environmental impact, we optimize the use of recycled materials in our paving services, thereby reducing waste, emissions and energy consumption. Fully integrated with our Essential Materials businesses, we have developed our Road Solutions offering to provide customers with quality, flexibility, speed, expertise and convenience through our deep market knowledge and highly capable team of professionals.
Building and Infrastructure Solutions
Our Building & Infrastructure Solutions connect, protect and transport critical water, energy and telecommunications infrastructure to help solve complex construction challenges. We integrate design, materials, products and engineering to enable the transition to a more sustainable and resilient built environment with a particular focus on the below-ground built environment where we are a leading provider of multi-material infrastructure that connects and protects the critical utilities that enhance the daily lives of millions of people.