Breedon's revenues on the rise despite flat construction market

Revenue at the construction materials group increased 32% to roughly £739m over the ten months ended 31 October, as recently acquired Lagan Group “traded strongly” and its integration progressed well.

Sales volumes of aggregates increased by 21% across the group, with asphalt up 45% compared with the prior year, though, in common with the rest of the market, concrete volumes declined by 5%.

The outfit’s underlying EBIT for the full year is expected to be in line with current market expectations of between £100m and £103m if weather conditions remain normal.

After the construction industry saw flat output in 2018, analysts expect modest growth next year before it picks up pace in 2020. Meanwhile the Republic of Ireland is expected to deliver double-digit growth.

“Whilst we are mindful of the likelihood of continuing cost pressures next year, coupled with the unpredictability of the outcome of the Brexit negotiations, we have consistently demonstrated our ability to deliver value for our shareholders, irrespective of market conditions,” the AIM traded company said in its statement.

The statement added that sustained organic improvement, strong cash generation, broadening geographical exposure and further potential acquisitions had given the board confidence of “further progress” next year.

Breedon’s shares were down 0.99% at 70.20p at 0901 GMT.