Breedon Aggregates still on growth trail

A revenue increase of 2.7% to £173.5 million and underlying EBITDA up 18.3% to £20.2 million are among the highlights of 894 Breedon Aggregates’ results for 2012.

The preliminary results for the year ended 31 December also show underlying operating profit at £8.8 million (+55.4%) and underlying profit before tax at £5.6 million

Total non-current assets are £148.1 million.

Breedon, the UK’s largest independent aggregates business, says it sold 4.3 million tonnes of aggregates; 1.2 million tonnes of asphalt and 481,000 m³ of ready-mixed concrete during the year.

Peter Tom, executive chairman, said:

“I am pleased to report that, despite the worst trading conditions I can remember in my 50 years in this industry, Breedon Aggregates continued to grow and prosper in 2012. Group revenues increased and our profitability improved.

“Looking ahead, the challenges in 2013 look like being every bit as tough as they were last year.

“The 3742 Construction Products Association [CPA] is forecasting that construction output will fall by more than 2%, with no meaningful recovery until 2014. Against this backdrop, it would be easy to let the gloom get the better of us, but we have a strong and finely-tuned business which is well equipped to cope with difficult economic conditions and we remain enthusiastically committed to growing the group in the years ahead.

“When we created Breedon Aggregates in 2010, we did so in the knowledge that we could expect little or no help from the construction market. Our models were predicated on delivering real value if necessary through self-help alone.

“It is this approach and mindset which give us the confidence to anticipate another year of progress in 2013.”

Other highlights included the EBITDA margin up 1.5 points to 11.6%; underlying earnings increased in both England and Scotland; value-enhancing performances from recent acquisitions; key health and safety target achieved and major capital investment projects completed.

While the company withdrew from the bidding for the assets being sold by 868 Tarmac and 725 Lafarge as a condition of their new building materials joint venture, it says it continues to see many growth opportunities in the UK, both through selective acquisition and organic development.

It says its recent moves into mobile concrete plants and the mini mix business have been successful and it has identified several interesting possibilities for new concrete and asphalt plants.

“A number of acquisition opportunities are under active consideration and we are excited about the prospect of further growing the business in 2013,” says the company in a strategy statement.