Research Update: CRH Outlook Revised To Stable On Expected Resilient Performance; 'BBB+/A-2' Ratings Affirmed

We expect Ireland-headquartered building materials group CRH plc to post resilient performance in 2019-2020, benefiting from the full-year effect of the Ash Grove Cement acquisition, steady performance in most of its developed markets, and cost-efficiency measures. We also anticipate that CRH's acquisition policy will moderate compared with past few years' transactions. As result of it, we anticipate that CRH's S&P Global Ratings-adjusted funds from operations (FFO) to debt should settle between 31% and 34%, a range we consider commensurate with our current rating on the group. We are therefore revising our outlook on CRH to stable from negative, and affirming our 'BBB+/A-2' ratings. The stable outlook reflects our view that CRH will likely exhibit steadily strengthened margins and benefit from

...- We expect Ireland-headquartered building materials group CRH plc to post resilient performance in 2019-2020, benefiting from the full-year effect of the Ash Grove Cement acquisition, steady performance in most of its developed markets, and cost-efficiency measures. - We also anticipate that CRH's acquisition policy will moderate compared with past few years' transactions. - As result of it, we anticipate that CRH's S&P Global Ratings-adjusted funds from operations (FFO) to debt should settle between 31% and 34%, a range we consider commensurate with our current rating on the group. - We are therefore revising our outlook on CRH to stable from negative, and affirming our '###+/A-2' ratings. - The stable outlook reflects our view that CRH will likely exhibit steadily strengthened margins and benefit from continued robust free cash flow generation, aiding the gradual recovery of the group's credit metrics, despite shareholder remunerations sustained above pre-2018 levels....

Research Update