Q1 2025 CRH PLC Earnings Call

Krista: Good day and welcome to the CRH First Quarter 2025 Results Presentation. My name is Christa and I will be your operator today. All lines have been placed on mute to prevent any background noise.

Krista: After the speaker's remarks, there will be a question in answer session. If you would like to ask a question, please press star then the number one on your telephone keypad at any time. If you would like to withdraw your question, it's star followed by the number one again.

Speaker Change: At this time, I'd like to turn the conference over to Jim Mintern, CRH Chief Executive Officer, to begin the conference. Please go ahead, sir.

Speaker Change: Hello everyone, Jim Mintern here, CEO , CEO , CRH, and you're all very welcome to our Q1 2025 results presentation and conference call.

Speaker Change: Joining me on the call is Alan Connelly, our Interim CFO , Randy Lake, Chief Operating Officer and Tom Holmes, Head of Investor Relations. Before we get started, I'll hand over to Tom for some brief opening remarks.

Tom Holmes: Thanks Jim. Hello everyone. Before we begin I'd like to draw your attention to slide one shown here on screen. Sharing our presentations will be making some forward-looking statements relating to our future plans and expectations.

Tom Holmes: These are subject to certain risks and uncertainties and actual results and outcomes could differ materially due to the factors outlined on this slide.

Tom Holmes: For more details, please refer to this slide, our annual report and other SEC findings which are available on our website.

Speaker Change: I will now hand you back to Jim Allen and Randy to deliver some prepared remarks.

Speaker Change: Thanks Tom, over the next 15 minutes or so, we will take you through a brief presentation of our first quarter results. Highlighting the key components of our operating performance for the first three months of the year, our recent capital allocation activities, as well as providing you with an update on our expectations for the year as a whole.

Speaker Change: First on slide three, some key messages from our results announcement.

Speaker Change: Overall, we had a good start to the year and what is the seasonally least significant in quarter for our business.

Speaker Change: Despite contending with some unfavorable weather across many parts of our business, we delivered further growth in revenues, adjusted EBTA and margin compared to the prior year period. Supported by the continued benefits of our differentiated strategy, positive pricing momentum and good contributions from acquisitions.

Speaker Change: We remain focused on allocating capital towards higher growth markets, benefiting from secular growth tailwinds. And in the first three months of the year, we completed eight value accretive vote on acquisitions for approximately $600 million across the areas of essential materials, road solutions, critical infrastructure, and outdoor living.

Speaker Change: Notwithstanding the current macroeconomic uncertainty, the underlying demand environment across our key end markets remains positive. And we are pleased to reaffirm our previous financial guidance for 2025.

Speaker Change: Assuming normal seasonal weather patterns for the remainder of the year and no major dislocations, the political or macroeconomic environment, we expect the full-year adjustity of the DA to be between $7.3 and $7.7 billion.

Speaker Change: Representing another strong hero of growth and value creation for CRH.

Speaker Change: Turning to slide four and our financial highlights for the first three months of the year.

Speaker Change: Overall, a good performance with revenues adjusted EBITDA and margin all ahead of the prior year period.

Total revenues of $6.8 billion worth 3% to head.

Speaker Change: This trend lays it into adjusted EBTA of $495 million, 11% ahead and the further 50 basis points of margin expansion, reflecting continued operational improvements and strong discipline across our business.

Speaker Change: As you can see on this slide, we reported a small loss in a diluted earnings per share, which is not unusual for the first quarter of the year and reflects the seasonal nature of our business.

Speaker Change: Now, at this point, I will hand you over to Randy to take you through the operating performance of each of our businesses.

Randy Lake: Thanks Jim, hello everyone. Turning to slide six and starting with America's material solutions which had a good start to the year despite adverse weather conditions impacting activity levels across many parts of our business.

Randy Lake: Total revenues were 2% ahead of the prior year period, supported by positive pricing momentum across all lines of business, further operational efficiencies and good contributions from acquisitions.

Randy Lake: In essential materials, first quarter revenues were 3% behind the prior year driven by lower weather-impacted volumes in most regions.

Randy Lake: Our aggregate's pricing increased by 8% while cement pricing increased by 4%.

Randy Lake: In road solutions, increase paving activity along with growth in both asphalt and ready-mixed concrete volumes, resulting in Q1 revenues 5% ahead of the prior

Randy Lake: Of course, it's worth noting that this is the seasonally least significant quarter for our America's material solutions business, typically only representing 10 to 15% of our annual volumes.

Randy Lake: Combined with the timing of our annual maintenance programs, you can also see how seasonally insignificant this period is from an adjusted EBITDA and margin perspective.

Randy Lake: In terms of the demand environment I'm pleased to report that the underlying backdrop across our key markets remains positive.

Randy Lake: Infrastructure, our largest end market, continues to be underpinned by state and federal funding through the IIA.

Randy Lake: Only one third of I.I.J. highway funding has been deployed to date highlighting the significant runway we have ahead of us.

Randy Lake: We also continue to see good levels of re-industrialization activity, particularly in manufacturing and data centers.

Randy Lake: Looking ahead as the construction season gets fully underway across many of our markets, I'm also encouraged by the positive momentum we're seeing in our bidding activity and indeed our backlogs, which are ahead of the prior year in both volume and margin.

Randy Lake: Next to America's Building Solutions on Slide 7, where our business delivered a resilient performance in the first quarter reported by solid underlying demand which was offset by challenging weather conditions in subdued residential activity.

Randy Lake: First quarter revenues in our building and infrastructure solutions business were 4% ahead of the prior year supported by good demand in the manufacturing sector and significant funding for critical water and energy infrastructure.

Randy Lake: In outdoor living solutions, although the underlying demand environment for residential repair and remodel activity remains resilient, a weather delayed start to the season resulted in Q1 revenues 3% below the prior year.

Randy Lake: Moving to international solutions now on slide 8, where a business delivered a strong first quarter performance supported by further pricing progress and good contributions from acquisitions. Particularly our investment in ad bribe.

Randy Lake: Total revenue growth of 7% translated into a 22% increase in adjusted EBITDA and a further 70 basis points of margin improvement, reflecting strong cost control and further operational efficiencies across our business.

Randy Lake: In Central and Eastern Europe , we continue to experience positive underlying demand despite adverse weather in certain regions. While Western Europe activity levels are improving, supported by infrastructure and non-residential demand.

Randy Lake: Overall, a good start to the year for our business, and at this point I'll hand you over to Allen to take you through our financial performance in recent capital allocation activities in further detail.

Thanks, Randy. Hello, everyone.

Alan Connolly: Turning to Slide 10 and the key components of our adjusted EBDA performance.

Alan Connolly: Starting with organic growth of $8 million, 2% ahead on a like-for-like basis, a good performance in the context of unfavorable weather conditions impacting activity levels during the quarter.

Alan Connolly: Acquisitions net of divestitures delivered a further $43 million of adjusted EVTA, reflecting good contributions from acquisitions as well as the impact of last year's divestiture of the European line operation.

Overall, we delivered $495 million of adjusted EBDA.

Alan Connolly: 11% ahead of the prior year period and representing a good start to the year in what is our seasonly least significant period.

Next to Slide 11.

Alan Connolly: where I will take you through some of the key components of our net depth movements and our strong and flexible balance sheets.

Alan Connolly: Firstly, on the left-hand side you can see we ended 2024 with a net debt position of $10.5 billion.

Alan Connolly: Turning to our cash flow performance, we reported a cash outflow of approximately $700 million in the first quarter.

Alan Connolly: An outflow at this stage of the year is to be expected, given the seasonal nature of our business.

Alan Connolly: As it reflects the build-up in working capital in advance of second and third quarter trading which are seasonally our most important periods.

Alan Connolly: Acquisitions, net of divestitures and other items resulted in an outflow of approximately $600 million during the first three months of the year.

Alan Connolly: We also invested $600 million in capital expenditure to support further growth in our existing business.

Alan Connolly: And we returned 300 million dollars in the form of share buybacks. Demonstration our commitment to returning cash to our shareholders.

Alan Connolly: Taking all of this into account results in a net deposition of $12.7 billion at the end of the first quarter.

Alan Connolly: Representing a net debt to adjusted EVTA ratio of approximately 1.8 times on a trailing 12 month basis.

Alan Connolly: Building upon our proven track record of value creation which is underpinned by our unmatched scale, breadth and financial capacity.

Alan Connolly: During the first quarter of the year we completed H value accretive boton acquisitions for approximately 600 million dollars.

This includes the acquisition of tally construction.

Alan Connolly: A vertically integrated asphalt and paving business with operations in Tennessee, Georgia, Alabama and North Carolina.

Alan Connolly: Complementing our existing operations and enhancing our capability to serve our customers in these markets.

Alan Connolly: This was followed by our acquisition of Weaver & Sons, an integrated provider of asphalt, paving and construction services representing our strategic entry into the Southern Alabama market.

Alan Connolly: These are examples of the continued development of our customer-connected solution strategy and our commitment to allocating capital into attractive higher growth markets.

Alan Connolly: We have a strong and active pipeline of opportunities in front of us thanks to our differentiated strategy and the fragmented nature of our markets.

Alan Connolly: And we will continue our disciplined and valued folks approach when it comes to the allocation of our shareholders capital.

Alan Connolly: We also continue to return significant amounts of cash to our shareholders.

Alan Connolly: Our ongoing share-by-back program has returned approximately 500 million dollars so far this year. And today we are commencing a further quarterly tranche of 300 million to be completed no later than August 5th.

Alan Connolly: I'm also pleased to report that the board has declared a quarterly dividend of 37 cents per share representing an increase of 6% on the prior year.

Alan Connolly: In line with our strong financial position on policy of consistent long-term dividend growth.

Alan Connolly: Thanks Alan, a good demonstration there of our relentless focus on the disciplined and efficient allocation of our shareholders capital.

Alan Connolly: Now, before I provide an update on our financial expectations for the full year, let me share our latest thoughts on the outlook across the markets.

Alan Connolly: Turning to slide 14 and first to infrastructure, our largest end market.

Alan Connolly: Here we expect demand in the United States to be underpinned by the continued role as of states and federal funding.

Speaker Change: As Andy mentioned earlier only a third of double IJA highway funds have been deployed so far highlighting the significant runway that lies ahead.

Speaker Change: In our international markets we expect robust demand and infrastructure activity to continue, supported by significant investment from government and EU funding programs.

Speaker Change: In non-residential, we expect continued positive momentum across our key markets supported by large scale manufacturing and data center activity.

Speaker Change: In the residential sector, we expect new build activity in the US to remain subdued, while repair and remodel activity remains resilient.

Speaker Change: In our international markets, we expect residential activity to stabilize with structural demand fundamental supporting a gradual recovery.

Speaker Change: As we have said in the past, we believe the long-term fundamentals for residential construction remain very attractive, supported by favorable demographics and significant levels of underbuilt.

Speaker Change: Regarding the pricing environment, we expect positive momentum to continue across our markets, supported by disciplined commercial management as well as the benefits of our differentiated strategy.

Speaker Change: Due to the localized nature of our operations we do not expect a material direct impact from recent changes in global trade policies on our business.

Speaker Change: In terms of the impact of the wider macroeconomic uncertainty it is clearly very fluid but we continue to monitor the situation closely and we are confident in our ability to navigate our way through us.

Speaker Change: So in summary, despite the current macroeconomic uncertainty we believe the overall trend is positive for a business.

Speaker Change: Our differentiated strategy and leading positions of scale in attractive higher growth markets together with our strong and flexible balance sheet leave us well positioned to capitalize on the strong growth opportunities that lie ahead

Speaker Change: Turning to side 15 and against that backdrop we have reaffirmed our financial guidance for 2025.

Speaker Change: Assuming normal seasonal weather patterns for the remainder of the year and no major dislocations in the political or macroeconomic environment, we expect a full-year group adjusted the BTA to be between $7.3 and $7.7 billion.

Speaker Change: Net income between 3.7 and 4.1 billion dollars and diluted earnings per share between $5.34 and $5.80, representing another strong year of growth and value creation for CRH.

Speaker Change: It's still very early in the construction season across our markets but we will update you on our expectation as the year unfolds and the season gets fully underway.

Speaker Change: So, that concludes our presentation today. I will now hand you back to the moderator to coordinate the Q&A session of our call.

Speaker Change: Thank you. As a reminder to those on the phone, press star one if you would like to ask a question. We will now pause briefly while we register questions in the Q&A roster.

Speaker Change: And we'll take our first question from Trey Grumes with Stevens. Please go ahead.

Speaker Change: Good morning everyone. If you could maybe elaborate a little more on the 25 guidance in light of the macro uncertainty that we have here and also maybe in pluses and minuses you've assumed in the guide. Thank you.

Speaker Change: Morning Tray, Jim here. Maybe I'll ask Alan to come back to the puts and takes on the detail on the guidance but listen very happy this morning please to reaffirm the full year guidance and it really reflects a good and a strong start to the year for us and that reflects the...

Speaker Change: Positive underlying demand that we have that we're seeing across our key markets and indeed the continued execution of our differentiated strategy.

Speaker Change: It's early in the season, but you know we're feeling positive on 2025 and most importantly for me a lot of the key building blocks that we need to put in place.

Speaker Change: around pricing, you know, what we're seeing on our backlogs and what we're seeing on our level of bidding, you know, that gives us that encouragement in terms of the guidance for the year. Now, whilst the wider, clearly, the wider macroeconomic situation remains flued,

Speaker Change: Particularly in the foreign exchange, Marcus Rice, which is volatile and changing by the week, we're continuing to monitor that very closely.

Speaker Change: But I'm confident, you know, in the resilience of our business model, and also particularly the experience nature of the management team, you know, we have an experienced team which is managed through as a proven track record of navigating periods of uncertainty both recently in the pandemic.

Speaker Change: So kind of putting all that together that's what gives us that confidence and been able to reaffirm the guidance for the year and you know looking forward to give them further updates when we report on Q2 in early August .

Alan Connolly: Maybe Alan, do you want to give a picture of some of the puts and takes? Sure Jim, thanks for that and morning tray and with regard to the underlying assumptions under pinning our guidance, I might just address that three key items.

Alan Connolly: Firstly, as pointed out earlier, we did good start to the air from an M&A perspective. 8 acquisitions, approximately 600 million.

Alan Connolly: Now, based on last year's acquisitions, we had previously guided the positive next contribution of about 280 million of adjusted EBTA for 2025.

Alan Connolly: Now, including the partial year contribution from this year's activity, we expect a slightly higher net contribution of about 320 million.

Alan Connolly: Next on FX as Jim said it's very hard to predict but we continue to monitor the ongoing volatility very closely.

Alan Connolly: And finally, it will recall that in 24 we benefited from higher than normal levels of land sales.

Alan Connolly: We continue to expect a more normalized year in 2025 somewhere in the region of about 75 million as we did in the case of previously.

Speaker Change: Got it. Thank you both very much Jim Allen and I will pass it on. Thank you. Good luck.

Speaker Change: Here next question comes from the line of Jerry Ravich with Goldman Sachs. Please go ahead.

Speaker Change: Yes. Hi. Good morning, everyone. I'm wondering if you would mind just talking about volume trends that you've seen in March and April if you're willing to comment and separately. Can you just update us on your pricing expectations?

Speaker Change: In aggregates and cement over the course of this year and any volume comments I was impressed with aggregates pricing in the first quarter.

Speaker Change: Yeah, thanks Jerry. This is Randy. I'll take that on I guess for us as we look forward you know our biggest indicator of future work is the backlogs and that typically.

Speaker Change: It gives us, you know, six to nine months view of work and that would be everything from kind of typical maintenance work to capacity expansion and the roads and highways and the backlog also is inclusive.

Speaker Change: of our critical infrastructure of business. And as I look at that, it may be three things. One, the quantum of work that we continue to bid on a weekly basis is increasing, which is encouraging.

Speaker Change: The volumes are up versus last year in all product lines, but more importantly, the margins are improving as well.

Speaker Change: You know, that gives us really the confidence as we look forward to really just reaffirm I guess what we had said back in March around.

Low single-digit growth in terms of underlying aggregate volumes.

and mid to the high single digits on pricing.

Speaker Change: Q1 8% off to a good start, but I think that really votes well for the balance of the year.

I think.

Speaker Change: As others have called out not surprising a weather impacted January and February but when we saw the weather moderating and getting back to somewhat normal conditions we saw a nice pickup in activities in March and April kind of high single digits so what you would expect really reflective of the backlog and kind of our overall outlook.

Speaker Change: Super, thank you Andy. Can I just ask separately, international solutions had a good margin expansion in the quarter on strong cost control given

Speaker Change: The pricing cadence, can you just expand on the drivers of cost improvement and how are you thinking about costs and coming quarters. I know it's not a seasonally high quarter obviously but the cost performance is quite good.

Speaker Change: Yeah, sure, Jerry. A good strong performance in the international business in Q1, really a number of things coming together.

Speaker Change: We've kind of called it out towards the end of last year that we're beginning to see kind of a troughing and a lot of our key Western European markets.

Speaker Change: And certainly we saw good activity in some of our key markets in Q1 right now they were laughing against a Q1 last year had it was tough weather wise in Europe West but in particularly we did good performance in Europe West Europe East actually had quite a challenging weather performance but again as we kind of got through that you know the continued good.

Speaker Change: A strong volume kind of outlook on Europe based on the pin by infrastructure really seen that moving into April right and across Europe generally a good price in environment too looking for kind of mid-single digits across Europe .

Speaker Change: That together with the contribution from Adbright, which is both in July last year, it's going well as we said the integration is going well and the head of where we expected to in terms of opportunity in terms of synergies. So those factors coming together really explain the good performance in international Q1.

Thank you.

Your next question comes from the line of Anthony Pettinari with City. Please go ahead.

Good morning.

In terms of project progress, you know, post-deliberation day.

Sure. Morning Anthony.

Speaker Change: Yeah, listen, we're not seeing any, at this point in time, any cancellations or delays. Not clearly, it's still very early in the season, but as Randy mentioned, our backlogs are positive.

Speaker Change: And that's really reflected in the guidance that we're reaffirming again today. You know, we continue to see positive momentum in our major private number as categories and that's been supported by the re-industrialization and young showing activities. These projects tend to be, as we said, typically quite large and very highly specced and highly technical projects which of course really falls into our sweet spot from that perspective. And we're talking things like data centers and also some of the high-spec manufacturing.

Speaker Change: We also called it out in the full year earnings. We're seeing some recovery on the warehousing also. Now, you know, so we're not seeing any cancellations and delays, but also maybe just highlight that it's not just about the individual projects as well, right? There's a substantial knock on effect in terms of increased demand for broader building materials and broader infrastructure build out as well. Meaning that the total kind of construction requirement is often a multiple of the actual core project itself. So no cancellations, no delays, and the back clouds are...

and positive.

Thank you.

Okay, that's helpful. I'll turn it over.

Speaker Change: Your next question comes from the line of Ross Harvey with Davey. Please go ahead.

Ross Harvey: Hi all and thanks for taking my question. I'm wondering can you provide an update on the energy and the more general input cost environment.

And morning Ross, I might take that one Alan here and

Alan Connolly: Just touching on the more general cost impulse obviously firstly energy is a key part of us, which it was also considered the other significant cost items CRH, which we've called a previously labor raw material subcontractors, etc.

Alan Connolly: There's a lot of moving parts depending on the market and the cost category as you could well imagine and overall we're still operating in an inflationary cost environment and we would see a mid-single digit inflation expected for the full year at 25

Speaker Change: I suppose most notably for me, and it's already been highlighted by Randy earlier, this really shows the importance of continued pricing momentum across the business as we target another year of margin expansion as you can tell.

Many thanks. Thank you.

Katherine Thompson: Your next question comes from the line of Catherine Thompson with Thompson Research Group. Please go ahead.

Katherine Thompson: Hi, thank you for taking my question today and really two parts.

Katherine Thompson: 1 on M&A and then 1 on infrastructure as a mirror for each other, just given the macro uncertainty. Could you give an update on your M&A pipeline?

Speaker Change: in any change in capital allocation priorities and in light of the broad macro outlook, and then on the flip side of that, when we do our work here at TRG with our state lettings.

Speaker Change: We are finding a building in the momentum of snowball effect that we've been tracking for a couple of years for solid, mid-teens, increases in lettings from key states, including many years in.

Speaker Change: Are you seeing that work show up and how does that impact, what is that impacting in terms of your infrastructure outlook, not just for 2025, but beyond. Thank you very much.

Speaker Change: Thank you, Catherine. Good morning. Two questions there. I might ask Randy, maybe to pick up the infrastructure one. Maybe first we talk about M&A and capital allocations. Well, firstly, no change to capital allocation priorities, Catherine overall. Really good start to M&A and the development in the first quarter, right? And the particular eight deals.

Speaker Change: in the quarter, which typical CRH deals, kind of a lot of bolt-on deals. What was really encouraging for us actually is that seven of the eight were one-on-one negotiations. If it really strikes to the kind of national footprint and those close relationships we have across the industry. So eight deals, 600 million, we have a full

as a pipeline as we look out with good

Speaker Change: Optionality, as we look out to the 90-year, both in terms of bolt-ons, but also some interesting mid-size deals as well, but you know, we're not going to lose that financial control of discipline. I think that's what you get from CRH, when you look at it, and I think given the kind of connected nature of the fourth volume, we really have multiple avenues for how we invest, right, and how we deploy capital. And that, with your much scales and those kind of local relationships and local positions, really kind of keeps that M&A pipeline good for us.

Speaker Change: In terms of growth topics, we'll continue to invest in what a low risk and high returning opportunities in many of our fastest growing markets.

Speaker Change: And this morning, as you saw, we've announced a 6% increase in the quarterly dividend and also a continuation of a share buyback program another 300 million. That's morning at an annualized rate of 1.2 billion.

Speaker Change: And in fact, since we started that program over six years ago, we've now retired nearly 22% of our stock at about $47 a share. So really good, you know, Stewart took the capital from that perspective.

Speaker Change: So overall I think given the scale of the business and you know the continued execution of a different differentiated strategy and the optionality we have in terms of multiple avenues of growth. It really that together with the strength of the balance sheet gives us our financial capacity to...

to support the continued growth of the business.

Speaker Change: Maybe Ram, they do want to pick up the infrastructure? Yeah. Maybe just a couple quick comments on that. I think your intuition and research is correct. So what I think we called out.

Speaker Change: Maybe at the beginning of the IIJ that it was a five year bill but we thought it was going to take seven years to deploy the quantum of capital and just to be able to get the engineering and design work done to to let those projects bid.

and that's where we see it today.

Speaker Change: There's been, obviously, it's a particular area that has...

Broad.

Speaker Change: Support on either side of the aisle and which is encouraging. I called out our backlogs and I think the backlogs are interesting for a couple of reasons. One, obviously gives us a picture for the balance of the year.

Speaker Change: but it's also kind of a mix of work that we're seeing. So there is certainly a combination of that maintenance but also multi-year projects which against states have the confidence in long-term funding whether that's iij or even call out the work.

Speaker Change: or the work that's going to begin and starting to kick on in regards to the next evolution of the highway bill and you saw chairman grays come out with concepts in around a new revenue stream.

Speaker Change: As you know, the gas tax hasn't been raised since 1993, not even indexed for inflation, so the conversation at least around a continuation of funding is happening early, which is encouraging.

Speaker Change: And I think for us in particular if you look at where we operate geographically.

Speaker Change: and we're the beneficiary of a significant amount of that I.I.J.A funding. So I think we're in the right places to take advantage of that and the pipeline is strong. And to your point, I think we're seeing the bidding activity on a weekly basis kind of aligned with what you're calling out in terms of overall opportunities. And I think we're seeing the bidding activity on a weekly basis kind of aligned with what you're calling out in terms of overall opportunities.

Great, thank you very much.

Speaker Change: Here next question comes from the line of Brent Thielman with DA Davidson. Please go ahead.

Brent Thielman: Hey, great. Thank you. Good morning. It seems as though you have a relatively constructive outlook for the international solutions portion of the business, especially as we kind of move beyond the seasonally slow.

Speaker Change: I'm wondering if you can just expand upon some of the things that you're seeing today and maybe especially since Liberation Day that might inform that view and, again, just looking for similar color on how you see the rest of the year play out for International. Thank you.

Speaker Change: Yes, sure, Brent. I think, you know, what we saw in the first quarter was really what we began to highlight on the full year results, you know, particularly if you look at a...

Speaker Change: The Western European market has had a tough number of years, right? When you take it from Brexit, into the pandemic, into the war, and energy crisis, and we've started to see a trophy now of activity levels in some of our key markets towards the second half of 2024. And we're beginning to see that recovery, right, in some of those key markets.

Speaker Change: That kind of scatter with another number of other factors, right? The really continued route of the continuation of the good growth that underpin central eastern Europe .

Speaker Change: Right, that is a region, some of our key markets, which is really heavily underpin by EU and for infrastructural funding, but also good activity on the non-reside. And, you know, we saw it last year, and we called it out, with the kind of more aggressive and accelerated cut of the euro interest rates, we're beginning to see some green shoots on the residential activity too and so of our markets there.

Speaker Change: So that together with all the self help measures we took and good kind of commercial excellence is really what's driving the performance in the international division and gives us that outlook, you know positive outlook for it for 2025 and indeed for a number of years to come I think we're going to see that because particularly in the Western European markets and recovering from, you know, trafying levels of activity.

Thank you.

Speaker Change: Here our next question comes from the line of Garrick Shmoi with loop capital markets. Please go ahead.

Garrick Shmoy: Oh, hi. Thanks for taking my questions. Um, two follow-up items for me. For some of the M&A side, are you seeing any change in sellers, attitudes, extrications, or the type of assets that are for sale? Uh, just given the uncertain macro and then follow up on a cost piece. Will there any maintenance or contracting services cost that would pull forward into the first quarter, just given the weather. Uh, headwinds, perhaps taking advantage of us, lower shipments to accelerate repairs.

Speaker Change: Yeah, thanks, Garek. I might get ready to come back on the cost one, but in terms of M&A. We're not yes, Garek. You know, we've eight deals done and the first quarter of the pipeline is good. We're not seeing any ameleration in terms of aspirations from the sellers yet.

Speaker Change: Now, clearly as this may be, you know, as uncertainty is out there may impact that later, but we're not seen as in terms of multiples or entry multiples. And I think the eight deals we did. The first quarter were very much kind of typical kind of CRH average entry multiple deals. You know, but again, I think that reflects kind of our unique position. You know, we operate in quite a fragmented industry. There's plenty of opportunity there, but I really that connected nature of all portfolio as I mentioned earlier just gives us kind of multiple options and.

Speaker Change: Leavers were to deploy capital. And that's what we continue to do in Q1 and that's what's been driving a lot of the performance in recent years.

Speaker Change: Andy, maybe do you want to comment on the cost out of us? Yeah, or say certainly in the winter months, whether without the extent of the weather we called out, and that's when we typically would perform our maintenance activities to get ready for the season, whether that's within our aggregate business, within the cement plants in terms of shutdown and performing maintenance.

Speaker Change: I'd say most importantly is that we match that maintenance with the expected demand environment for the year ahead so to your point we take advantage of those times.

Speaker Change: with the expectation that once the season started in March that we'd be we'd be well prepared so but I wouldn't call it out as anything unusual for nothing.

that we ever do differently on a year-to-year basis.

Understood. Thank you.

Speaker Change: Your next question comes from the line of Keep Hughes with Truist Securities. Please go ahead.

Keith Hughes: Thank you. My question is in America building solutions. What are you expecting for the remainder of this year, both within the two product groups and for margins?

Yeah, hi Keith. Good morning.

Keith Hughes: I think first in terms of the American building solutions, it's really a division which is coming off the back of a number of very strong performances over the last number of years, right? In 24 and indeed in the first quarter, I have described the performance really as resilience right now. Quarter one was impacted by a combination of challenging weather and also kind of it is the bit of our business which is most exposed to the residential cycle as well.

Keith Hughes: If you look at it, it's made up of two parts, our outdoor living business.

Keith Hughes: What we saw really was significantly weather impact of Q1 but as we got into kind of late March and into April we really saw kind of a delayed spring season in our outdoor living business and we saw good recovery in April and into early in May as well. So expecting that trend to continue.

Keith Hughes: The other side of the business is building an infrastructure, right? And that's a business which is primarily exposed to water infrastructure and indeed energy infrastructure, right? And I think for the member this year the backlogs are good.

Keith Hughes: And you know it whether it did impact to the bitten Q1 but as we're through that now we get more normalized we're seeing the work that is there to be done and I think the outlook for 2025 and indeed for a number of years to come particularly in that water and energy infrastructure space is quite positive for that business.

Speaker Change: Okay, thank you just one quick one. I think you said earlier land sales are very much 75 million and even on 25. What were they in 24? I think they were a good

Speaker Change: And yeah, just on that, they were 237 million was the 2024 comparative so quite an exceptional year for say but the ongoing average is about 75 million.

Okay, thank you.

Speaker Change: And we have time for one last question and that last question comes from the line of Will Jones with Redburn Atlantic. Please go ahead.

Will Jones: Thank you morning a two parts that could please the first just around the asphalt business in the US perhaps you can stop data on the winter field.

Speaker Change: Process how that went and to what extent you think the drop in the all price of late might have implications for pricing needs over the summer.

Will Jones: And in the second, just around Canada, clearly that's in the eye of the storm around tariffs at the moment, but to what extent the trends there if at all against the US. Thanks.

Speaker Change: Yeah, two questions there. Well, Matt asked Randy, maybe to take the first one on the just a Winterfilling asphalt and I come back in Canada.

Randy Lake: Absolutely. The wonderful, as you know, a significant competitive advantage for us across the country, kind of the network of tank storage.

Speaker Change: I'd say it's a very consistent year in terms of the quantum that we have as well as kind of the underlying cost position. I think.

Speaker Change: Important for us, probably the number one driver as to why we're in that business is is really access to

Benjamin Liquid asphalt during the peak of the season.

and so for us we can...

Speaker Change: The amount that we consume in any one given year so it's important to have access to that so.

Speaker Change: and that scale and that reach of that business is a significant competitive advantage no one will ever be able to duplicate that position that we have so that's the primary reason why we're in that business.

Speaker Change: I think what we've also seen is that we run that asphalt business on a margin basis.

Speaker Change: So we do see fluctuations in various points and times in terms of the online market, but when we look at the backlog of work that we have combined with what we have in storage, we have expectations for another year of margin progression in that asphalt business.

Speaker Change: I think also what it does, I've often said this about one of the other advantages of having that storage. Every road has a unique specification.

Speaker Change: And our capability to take that material, that off-spec material in some markets to be able to blend.

Speaker Change: to a specific specification for a state DOT is create a competitive advantage for us so we have not only storage but also that technical capability to deliver a unique solution for every road so I feel good about where we are this time of year and would expect another year of margin progression in that line of business.

Speaker Change: Yeah, well, and maybe just in Canada, you know, we have a firstly, a fully integrated business, it's mainly a Toronto-based business, a kind of local business. It's very early season, as you can imagine, just about to get going up there at this stage, and encouragingly some really good pricing environment. You know, it's very happy with the pricing performance and broadly similar trends, I think, in Canada that we're seeing elsewhere. So I think set up nicely and a nice asset base for the season ahead.

Thank you.

Speaker Change: And I will now time for today.

Speaker Change: That's all we have time for today. Thank you all for your attention and as always if you have any follow up questions.

Speaker Change: please feel free to contact our investor relations team. We look forward to take to talking to you again in August when we will report our results for the second quarter of 2025. Thank you and have a good day.

Speaker Change: Thank you. Your conference call has now ended and you may disconnect.