(Alliance News) - Construction materials firm Breedon Group PLC on Wednesday reported a double-digit profit rise and said it plans to declare a first-ever dividend in its 2021 interim results.
In 2019, pretax profit rose 18% to GBP94.6 million from GBP79.9 million. This was on revenue which was 7.8% higher at GBP929.6 million from GBP862.7 million.
Breedon said it had 20.2 million tonnes of aggregate sales in 2019, a 4.1% rise from 19.4 million tonnes in 2018.
Asphalt sales rose 7.1% to 3.0 million tonnes from 2.8 million tonnes in 2018, while ready-mixed concrete sales volumes dipped 6.3% to 3.0 million cubic metres from 3.2 million cubic metres.
Cement sales volumes were flat at 2.0 million tonnes.
Chief Executive Pat Ward said: "We closed 2019 with a strong result, in line with the market's expectations, reflecting an excellent performance from our businesses in some challenging market conditions.
"With the UK government committed to significantly increased investment in infrastructure, we are well placed to benefit from the increased demand for our products that this will create."
Breedon added that it intends to adopt a "progressive distribution policy from next year", and it will announce a maiden dividend in its 2021 first-half results.
Ward added: "Breedon is in excellent shape. We have a well-established business extending throughout GB and Ireland, having delivered great results irrespective of market conditions. We have an outstanding team of colleagues and, following the acquisition of the CEMEX asset portfolio, we will have the backing of more than a billion tonnes of valuable mineral reserves and resources, together with two well-invested cement plants."
Breedon announced the GBP178 million purchase of the UK assets of Mexican building materials peer CEMEX SAB de CV in January.
CEMEX's UK assets encompass approximately 100 operations across six divisions located in Scotland, Wales, North-East England, Norfolk, the East Midlands and Yorkshire.
However, the UK Competition & Markets Authority has since served an initial enforcement order on the acquisition.
Derby-based Breedon said this was expected, and said it is "actively" working with regulator to ensure it fully complies. Breedon still expects the deal to complete in the second quarter of 2020.
Ward added: "The group is monitoring the potential impact of the covid-19 virus and has contingency plans in place which will be refined as the government releases more information."
Shares in the company were 5.9% higher at 92.00 pence each in London on Wednesday morning.
By Eric Cunha; ericcunha@alliancenews.com
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Breedon (BREE)