CRH to invest €900 million in plants and facilities this year
Building materials giants CRH are set to invest €900 million in plants and facilities this year, its largest investment since before the global financial crisis, according to the Irish Times.
Davy analysts told the paper that CRH was putting mergers and acquisitions on the back seat, following its €6.5 billion purchase of assets from rivals Lafarge and Holcim in 2015.
Robert Gardiner, a Davy analyst, said: “Investments have stepped up in the group in 2016. This suggests that overall spend will soon reach about €1 billion, of which roughly €400 million relates to new projects in existing businesses […] we believe that the [capital expenditure] lever can also prove a material profit engine for the group.”
Almost two thirds of this capital expenditure is spent on its North American operations. Its Oldcastle Materials unit recently announced a project to build an asphalt plant and distribution centre in Texas.
Further expansion was also seen at its newly acquired Tarmac unit as it opened a new cement packing facility in Derbyshire.
Gardiner adds: “While only a small sample of the overall capex plan, these projects highlight the efforts under way at CRH to grow its existing business to take advantage of market opportunities.”
CRH’s current share price of €30.22 gives the company a market value of €25.1 billion.
