CRH helping staff in Ukraine to escape amid war

CRH has been helping the families of staff in Ukraine to escape the country following the Russian invasion a week ago, which has caused more than a million people to flee the war-torn state.

The building materials giant, which entered Ukraine in 1999 and has about 800 local employees, has temporarily shut and secured its operations across four locations, mainly in the west of the country, chief executive Albert Manifold told reporters on Thursday, after the group reported record earnings for 2021.

The company is putting up about 50 families of staff that were based in Kyiv and Odessa in a town in the west of Ukraine, he said. As of Thursday morning, CRH had helped move a further 59 families to neighbouring countries, including Poland and Romania, putting them up in hotels and providing money and food, he added.

Mr Manifold said that there has been a better take-up in recent days of CRH’s offer to help families escape, with many having previously been put off by the fact that men between 18 and 60 are not being allowed to leave the country.

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“Our people are safe. Our facilities are locked up and we’re doing what we can to get people across the border if they want to,” he said.

Ukraine accounts for about 1 per cent of group sales, according to CRH. Total sales rose 12 per cent last year to $31 billion (€28 billion), while earnings before interest, tax, depreciation and amortisation (ebitda) increased by 16 per cent to a record $5.35 billion – outstripping the company’s own forecast from November by $100 million.

CRH said on Wednesday night that it has decided to exit its small operation in the Russian market, in line with a number of western businesses. Mr Manifold told reporters that the remaining business there – made up of stakes in six small readymix plants – had effectively been closed since last summer due to low demand.

The Russian business was valued at only €1.5 million ($1.7 million), he said. That compares with the total $44.7 billion value of the group’s assets.

Margins expanded

CRH’s earnings grew and its margins expanded last year even as the global economy grappled with rising input costs.

“While the demand backdrop remains favourable across our markets, there are a number of challenges and uncertainties which we must continue to manage carefully as we look to deliver further value for our shareholders in the year ahead,” the company said.

CRH’s Americas Materials benefited from increased construction activity in 2021 due to strong residential demand in North America, while the same business in Europe delivered “good volume growth and pricing progress against a prior year comparative which was heavily impacted by pandemic restrictions”.

The group’s building products business saw sales grow 11 per cent, with like-for-like sales up 5 per cent, due to strong demand for residential construction and a moderate recovery in the non-residential sector, it said.

CRH said on Monday that it has agreed to sell its North American glass building products unit, Oldcastle Building Envelope, in a deal worth a higher-than-expected $3.8 billion to private-equity firm KPS Capital Partners.

Acquisitions

Mr Manifold has committed the equivalent of $17.7 billion to acquisitions since he took charge of CRH eight years ago, including $1.5 billion spent on 20 deals last year.

However, he has raised $8.5 billion over the same period selling businesses that were no longer delivering the required returns or growth potential, or otherwise not justifying continued existence within the group. The figure will reach $12.3 billion after the Oldcastle Building Envelope disposal is complete.