CRH Plc fell the most in nine months in Dublin trading as Ireland’s biggest listed company said sales will drop faster in Europe and growth in the Americas will slow.
CRH shares declined as much as 7.5 percent, the biggest fall since November, to 14.35 euros. Second-half like-for-like European sales will decline more than the 5 percent drop in the first half and growth on that basis in the Americas will be “well below” the 8 percent posted in the first six months, the building materials company said today.
CRH said it is advancing a cost-cutting program in response to “continued weakness in key European markets.” Euro-area construction output fell 8.4 percent in May from a year earlier, its fifth consecutive drop, according to Eurostat. Germany’s HeidelbergCement AG said last month it planned to improve profitability with two cost-cutting initiatives.
“Overall, we see realities of the sector catching up with CRH,” Ian Osburn, an analyst at ING, said in a note. “Management outlook becomes much more bearish.”
The stock was down 7.1 percent at 14.42 euros at 3:02 p.m. The shares have fallen 6.2 percent this year, giving the company a market value of 10.4 billion euros ($12.8 billion).
CRH’s cost-reduction programs saved 50 million euros in the first half of the year, bringing cumulative annualized savings to 2.1 billion euros since 2007, the company said today.