International building materials group CRH (LSE: CRH) dipped on third-quarter and nine-month results this morning, shedding around 35p off its closing price of 1385p yesterday.
This came despite like-for-like sales growth of 3% across the group in Q3, although it was slightly softer than the first half’s 5% growth, averaging the nine-month total down to 4%.
Europe was the main culprit here, seeing a 2% decline in the third quarter against a 6% gain in H1, with the Americas’ 6% growth (up from 4% in the first half) preventing further declines as overall economic recovery drove construction demand.
The first half had seen favourable early-season weather conditions in Europe, allowing for a better-than-expected demand for building materials, but the third quarter saw “moderating trends”.
In contrast, the Americas saw its first half affected by adverse weather, but operations benefited in Q3 from stronger underlying demand.
EBITDA forecast for the full year remains unchanged for the group: 10% growth, assuming normal weather patterns for the remainder of the year and a US dollar/euro exchange rate of 1.33.
A tale of two continents, then. Personally, I prefer to invest my money in companies whose profits don’t rely on uncontrollable forces such as the weather, and with CRH’s shares hovering near its 52-week low of 1,266p, I didn’t see enough in today’s update to convince me otherwise.
