CRH surprised the stock market on Wednesday by announcing that group finance director Senan Murphy will leave the building materials giant next year, having long been tipped as a future chief executive.
The Dublin-based company's director of group finance and fellow former top Bank of Ireland executive, Andrew Keating, is seen as the leading internal figure to replace Mr Murphy.
It is understood that Mr Murphy (51), who informed the board on Monday of his intention to step down, does not have any immediate plans for a new role. The group said in a statement that it was commencing a process to identify a successor and that Mr Murphy would remain in the position until that has been completed and will continue as an adviser after stepping down.
The development throws wider succession planning at CRH into focus, even though there are no indications that group chief executive Albert Manifold (58), who has been in the role almost eight years, has any intention of stepping down in the near term from the best-paid chief executive position among Irish-listed companies.
Three divisions
The global business comprises three divisions, with Americas materials led by Randy Lake, Europe materials run by Onne van der Weijde and building products headed up by Keith Haas.
Davy analyst Robert Gardiner said it was likely CRH would opt for an internal replacement for Mr Murphy, although an external candidate “cannot be ruled out”.
A spokesman for CRH declined to comment, while Mr Murphy and Mr Keating could not be reached for comment. Shares in the company fell as much as 2.1 per cent to €30.60 during trading in Dublin.
Mr Murphy, who formerly served as chief operating officer at Bank of Ireland, was appointed as the successor to Maeve Carton in January 2016. Other previous roles include chief operating officer and finance director at Ulster Bank and chief financial officer at wind energy company Airtricity.
Mr Murphy has been a key lieutenant to Mr Manifold, whose remuneration topped €9.1 million last year, as he has sought to reposition and simplify CRH in recent times.
Acquisitions
Under Mr Manifold, CRH has spent more than €13 billion on acquisitions and raised €5 billion from the sale of unwanted businesses. Last year CRH raised €2.1 billion from asset sales, including its European distribution unit, and 50 per cent stake in an Indian cement business that was acquired just before the financial crash in 2008.
CRH said last month that it would slow its normal pace of deal-making as it coped with the uncertain Covid-19 fallout in multiple markets.
It reported a 28 per cent decline in pretax profits to $518 million (€442 million) for the first half of this year. Mr Manifold said at the time that the group had $10 billion in available cash, partly on the back of savings made to combat the impact of coronavirus lockdowns on global construction markets.
He signalled that it would continue with the group’s long-term strategy of growing CRH partly through buying other businesses, despite looming uncertainty.
The figures for the first half covered a period when coronavirus shut down construction in many of the group’s main markets, particularly western Europe. However, aside from the northeast and Pacific northwest, shutdowns failed to slow activity in much of the US, where construction was largely treated as a critical industry.
