Breedon Group 1H sales nearly unchanged, says outlook is 'positive'

Yet the construction materials group sounded a confident note on the outlook, telling shareholders that by period end sales had recovered to their year-earlier levels as the sector emerged from lockdown.

Revenues for the six months to 30 June fell by a quarter to £335.3m, sending the company from £39.5m of profit before tax in 2019 to a loss of £10.1m and its underlying basic earnings per share from 2.03p to -0.65p.

Group chief executive, Pat Ward, said: "Following the encouraging performance of our businesses in the first 12 weeks of the year, the move into lockdown and immediate fall in demand in the latter part of March led us into a swift and managed shutdown of the majority of our operations, leaving open only those which were servicing critical needs.

"This decisive action ensured the protection of our employees, left our sites in a safe condition and also positioned us to return quickly to production when demand began to return in early May."

Sites began to reopen in May and by the end of June revenues were just 1% shy of the year earlier level, helped by an "encouraging" performance over the first 12 weeks of 2020.

Sales of aggregates fell from 9.9m tonnes in the first half of 2019 to 8.0m, those of asphalt from 1.4m to 1.0m, those of ready-mixed concrete from 1.5m cubic metres to 1.0m and those of cement from 1.0m to 0.8m.

Despite the pandemic's onslaught, Breedon managed to reduce debt to £253.6m, resulting in a leverage ratio of 1.9.

Financial headroom as at 30 June was £344.0m, with completion of the acquistion of Mexican outfit CEMEX's assets imminent and the outlook remaining "positive".

By 1504 BST, shares of Breedon were edging up 0.9% to 78.70p.