Good morning, ladies and gentlemen. I'd like to welcome you to our 2021 Results Presentation for CRH. My name is Albert Manifold, I'm the Chief Executive. And this morning I'll be joined later on by Jim Mintern, our CFO. And together Jim and I are going to briefly take you through the key headlines of our results for 2021. Now before we go into that, I just want to take a moment to talk to the nearly 80,000 people who have worked for CRH during the course of 2021. We had the continual challenges of COVID, trying to live lives in the most normal way the stop-start nature of what COVID impact upon our world. But all of you went about your life as normal as you could and help produce what was a really strong 2021. On behalf of your management team and your Board, I want to simply thank you for those tremendous efforts. I refer to COVID there. And of course we all hope we're in the end game of the challenges that COVID has brought to us. Let's see how that plays out. Of course in recent times, new uncertainties and new challenges have emerged. All I can say to you is that we as a senior team, most of us have been here for 20 years. And we have seen this country -- this company through some tough times, particularly the global financial crisis and the recent COVID challenges. And we're confident that we have the sensible nature to our lives, the maturity, the experience to see us through a navigate CRH through whatever choppy waters may be ahead of us into calmer waters. I should say this morning's presentation whilst I'm talking to you like this. There'll be some slides and presentations behind me.…

Thanks Albert. Good morning everybody. I'm delighted to be here this morning presenting my first set of results as CFO. On slide 11, what we have here is an overview of our cash flow and our net debt position at the end of 2021. I think this slide is a really good example of how our relentless focus on cash generation and our disciplined capital allocation, has ensured a strong balance sheet at the end of December 2021. Moving from the left, we exited 2020 with a net debt of $5.9 billion. The cash inflow for 2021 was $4.2 billion. We converted 80% of our EBITDA into cash and we reinvested in the growth of our business. We also returned cash to our shareholders. We completed M&A activity 20 bolt-on acquisitions and net cash outflow of $1.2 billion that figure is net of divestment proceeds. We spent $1.6 billion on capital expenditure. And we returned $1.8 billion to you our shareholders and I'm going to go into a bit more detail on each of those in a moment. That all resulted in a net debt position at the end of December 2021 of $6.3 billion or 1.2 times net debt-to-EBITDA. That's one of the strongest balance sheets we've had in the history of CRH and gives us optionality for further value creation for shareholders into the future. I'd now like to talk about some of our acquisition activity in 2021. We completed 20 bolt-on acquisitions for a consideration of $1.5 billion. That represented an EBITDA, entry-level pre-synergies of seven times, which really highlights our focus on maintaining our strong financial discipline, which of course, has been a real hallmark of CRH for many years. Looking into a bit more detail on those acquisitions, the vast majority of the acquisitions were…

Thanks Jim. Jim talks there about a structurally better business. And that's the term we use in CRH, and we've used it for quite a few years. But what we mean by a structurally better business? How do we back up this claim? How do we measure on some of the key metrics upon which we should be judged? Well, let's go and look at some of those key metrics. First metric I want to look at is our EBITDA growth. Look at our EBITDA growth against our peers. Here we show our peers being our global peers the big cement guys that are out there. Our U.S. peers, we've got two major U.S. peers, I won't name them you know who they are. And it looks at the growth in our EBITDA on 2018 to 2021. Now I didn't arbitrarily pick this period of time. Actually I could have picked any period. You can go back and check it yourself. But here you can see, CRH has outgrown anybody else in our industry. So, okay, that's interesting to see. So you can buy growth, you can take on growth anyway you can be well positioned. How well are you running your business? How efficiently are you running your business? Well, let's look at the margins in our business. Look to the next slide. This looks at the expansion of our margin over the same period of time. Great performance by our global peers, almost 3% ahead. U.S. peers a little bit ho-hum, but CRH almost 500 basis points ahead. By investing in our business model, by investing within our business, by working hard every day, we have improved the efficiency of our business to bring that margin performance. How does it all end up? Let's look at the next…

Good morning. Hi. Thanks Albert. Good morning everyone. So as Albert said, this morning's Q&A session will be moderated. I will take the questions that have been coming through over the last hour or so. I'll address them here to Albert and Jim on stage. Please continue to submit your questions over the Webcast portal. And we'll get through as many of them as we can. [Operator Instructions] There's a lot of overlap and recurring themes in the questions coming through. So hopefully, a lot of them will be addressed over the course of our conversation this morning. If not, if there's any outstanding questions at the end of the session, the IR team and I will be happy to follow-up with you directly over the course of the day. So, to kick us off, Albert, Jim I have two questions here from Robert Gardiner with Davy. The first is can you please quantify the impact of rising energy costs in 2021? And what are your expectations for 2022? And second is can you explain the strategic rationale behind the divestment of your Building Envelope business? And what are the implications for your integrated solution strategy going forward?

And maybe I'll take both Tom. Well maybe I'll pass the impact of energy on 2021 to Jim later on. First of all, good morning, Bob, I hope you're well. Let me deal with the disposal of Oldcastle BuildingEnvelope first and then come back to our energy issue. Look BuildingEnvelope has been part of CRH for about 30 years. It's a very fine business. We built that business up by acquisition and by geographic expansion, primarily within the United States. But we have become a very, very big gorilla in a small space. We began – we owned that space. And in CRH, as you know, of course we're very focused on operational performance. But actually, we created about two-thirds of our value for our shareholders through the acquisition process directly or indirectly. And that business was – we had a – we bought a very big business in 2015 C.R. Laurence and that was the last big business we bought in that space. Because actually we're running out of optionality to buy businesses. And if we have no M&A opportunities, we actually tie one hand behind our back. Secondly, that was a business that was focused on the glazing market. Our customer was the glazer. There were no other products we could sell to them. I've already talked this morning how our focus is on customers. We could do no more for them. We could sell more but then we were just an organic growth play and CRH don't really have too much interest in just being an organic growth play. And the last reason was that it didn't really integrate with our core competencies in and around a strong heavy complex infrastructure public or private or indeed residential as well. It was a non-residential business. And when we…

Sure. Good morning, Bob, as you know typically our energy build tends to be we said in a range of kind of 9% to 11% of our revenue. In 2021, it was just a little under 10%. As Albert said about half our energy bill tends to be in the liquid asphalt on the bitumen side and we've always managed that business from a margin perspective. The other half tends to be doing electricity diesel, gas, et cetera. And typically heading into any year, we'd have about 60% cover in place and that's no – not any different heading into 2022. So when you look at that range of kind of 9% to 11%, I expect it to pick up towards the higher end of that range in 2022. As Albert said in 2021 crucially despite the very significant inflation kind of leveraging on our solutions business we were able to push on margins across all three divisions.

Thanks, Jim. So Jim just a quick one. I see here the post-tax proceeds for the BuildingEnvelope divestment. Any thoughts on that?

Yes. We announced Monday. The total enterprise value of $3.8 billion for the divestment of Building Envelope. That included some assumed leases of about 350. So the net cash is about $3.45 billion net of tax a shade under $3 billion.

Next question here is from Gregor Kuglitsch in UBS. Two questions here. First one given the strength of the existing balance sheet and expected proceeds from Building Envelope, what are your intentions for redeploying this capital? And the second is can you detail how you aim to achieve the 25% reduction in carbon emissions by 2030? Can you elaborate on the additional costs or CapEx to achieve this?

Again, maybe I'll take the first here. Jim you might go back to you on the CapEx cost for that Tom. Gregor, good morning. I hope you're well. I take the CO2 reduction question first and foremost. Look, we're going to take the time in April to go through that in detail but it's primarily focused in three or four key areas. First and foremost, it's within the process. We're ongoing working on our process within all of our factories not just our cement business but also our aggregate concrete, concrete product facilities to decarbonize that. And again, that will be part and parcel of it. Innovating new materials, working with our customers to produce less carbon-intensive materials. Of course, there's expenditure -- there's capital expenditure to invest within our business. And of course, crucially is the area of fuels, not just the fuels we consume ourselves moving more to biomass and greenfields, but also the fuels that the energy that we buy in. And that's the primary areas of where our focus will be. Again, we'll take you through that in detail when we come forward in April. I'll go to Jim in a second with regard to the cost of that. Just with regard to the deployment of the capital that we have. Look I think you just have to trust CRH and trust the system. Over the last decade, we've sold $12 billion worth of businesses and we bought $18 billion worth of businesses. As Jim mentioned, the $12 billion that business we sold, we sold them at 11 times EBITDA and we bought business at 8 times EBITDA pre-synergies. So we have targets in mind, yes. It's a long list. Is there a big expansive huge deal we're going to do? No, we don't do that in CRH. Ours is an industry that is replete with fragmented smaller businesses. And what we will do is we will continue to gobble up those business, because when we buy smaller businesses, we see opportunities to create value in doing so. So it will take time, but we will reallocate that capital back into our business to create value for our shareholders. And we'll see how it goes during the course of this year and next year. Jim, with regard to the CapEx cost.

Good morning, Gregor. Yeah. Gregor, this is I think our fourth target that we've put out there in terms of carbon reduction. So -- what we have in place is a very clear process, location built up, location by location across the group in terms of how we're going to get there. We spend typically about -- in 2021, we spent $1.6 billion on CapEx. In 2022, we forecasted a little increase to $1.7 billion. Looking out in terms of the CapEx required to achieve that target, it's not a material step-up on that kind of level of CapEx $1.6 billion, $1.7 billion per year. However, I can assure you that all those projects that are required to deliver will again be looked through that same lens that we do for all capital projects. So in terms of returns criteria. So they will also earn a return on those investments.

Jim, there's a follow-up here on CapEx. CapEx for 2021 coming in higher than expected. Any thoughts on that?

Sure. Yeah. CapEx came in at $1.6 billion, as I mentioned earlier the context of that. We were able to pull forward some of that expansionary CapEx in some of those growth markets and again in our solutions businesses. So -- and as I said in around kind of Florida, Texas into Arizona, we have opportunities in terms of fast-growing markets and in terms of building out our capacity because the demand was there. So delighted to be able to support them, Tom. As I said, some of the lowest risk highest returning projects we have and we can get those kind of projects. So that explains the little tick up we were able to pull it forward.

Great. Next question here is from David O'Brien in Goodbody. The reshaping of the business in the last eight years has been very significant. Are you satisfied with your current portfolio, or should we expect further evolution from here?

I just said CRH is never static. We're always moving, not because we want to move because we must move. Our markets are constantly changing. Your markets are too. And we are anticipating those changes and guiding our business where those markets are going to. So yes, I do anticipate to continue to work on our portfolio. It should be. But the reason for that is that we want to develop a better business, a more profitable business and more cash-generative business, a business with higher growth. And we see the way our world is going. Our world cannot continue to build the way it's been built today, two billion people will arrive on this planet over the next 30 years. Where are they going to go? We just cannot afford to construct the world that will accommodate two billion people the way we're currently billing today. We're going to destroy the planet. So sustainable construction has to be the way forward. And companies like CRH are right in the center of developing sustainable construction products and materials. And that's why we'll continue to evolve our portfolio. And that's why we'll continue to evolve that portfolio in the developed world because that's where the change will start. So yes, the portfolio work will continue, but you would expect it to do so.

Thanks, Albert. Another question here from Arnaud Lehmann in Bank of America. What is the outlook for pricing in 2022 in Europe and the US? And do you expect to be able to cover cost inflation?

Okay. I'll take that one again. Pricing, Arnaud, look at very top of the question. I'm sure that question has been asked to every one of my CEOs of all the peer companies out there and you've heard the responses and so have I. As a response to the very significant cost increases, there's a strong need to get good pricing in the marketplace. And I endorse that comment I think there is too as well. We have been subject to some very challenging cost input in 2021. But our business is not just about pricing on and you can see that. Most of the businesses who are talking about pricing have taken a step back with regard to their margin. CRH didn't. And you have to ask the question why is that? We're not smarter than anybody else. There's no special colleges for pricing that we went to that no one else went to. It's our business model. It's different. We're becoming because of the solutions because we add value to the materials of place we sell and make our customers' lives easier. We get paid more for that. So pricing and a continuation of the solution strategy is how we insulate ourselves against cost headwinds and develop our business going forward. How that's going to play out in 2022, I don't have a crystal ball. All I can tell you is if you judge us on our track record for last year where energy prices went up by 65%, we had margin improvement. Again as I said earlier to Bob I'll tell you with knowledge when we stand in front of you here at the half year.

Great. Thanks. A lot coming through actually on US highway funding and infrastructure generally around the theme of when do you think it will translate into higher activity levels. That's been the main one. Any thoughts on that Albert?

Again maybe I'll take that. Look there has been a very supportive environment for federal funding and state funding for the last couple of years on the back of quite good economic performance in the United States. Of course you're referring to I think to the November statement that the bill signed on the Infrastructure and Investment Bill for a further $1.2 trillion investment in infrastructure. And there's no doubt that will supercharge investment for the next five years. I should mention of that $1.2 trillion CRH will be a significant beneficiary. Our top 10 states account for over 30% of all of the dollars being spent. $350 billion will be spent on roads. However, another $200 billion will be spent on infrastructure for water, telecommunications and IT again which plays right into our Infrastructure Products business as well. So really almost about $550 billion of that $1.2 trillion will go to the areas that we're focused on. So that should see strong growth. In fact we anticipate the spend in the next five years as I said earlier being up about 50% over the last five years. So significant growth going forward with regard to that. With regard to the timing of when it comes through look, we are working now our backlogs related to projects that were awarded and planned last year. So if you have a large infrastructure project you've got to get permission, you've got to design it you got to plant it you got to tender it. All of that takes time. There's probably somewhere between a 9 and 18 month lead time on those projects. So we don't anticipate any of the funding for the $1.2 trillion that you may be talking about hitting our business until the earliest the very end of this year probably start to come through in '23 and '24 will be the big years that benefit from it but not really that. This year is already set based on last year's funding.

Another two questions here from Paul Roger in Exane.

The first is on the outlook for US asphalt margins in the context of higher oil prices and could there be a lag between higher bitumen costs and the mitigating price rises as a result. And the second one around the likelihood of large acquisitions in 2022.

Okay. Not 15 questions today only 2. I'm sure the 13 are following tomorrow morning with your note. I'll pass the comment on margins to Jim now in a moment with regard to asphalt. Look the likelihood of big deals. The only likelihood that of those deals in CRH is value deals. Whether they're big or small it will all be about value. Because that's the history of CRH. We don't need to go out and do big blowout deals. If I look at our industry in North America about sort of 15% of the industry is across the top five players. 85% is fragmented and unconsolidated. If you look at the deals we did last year $100 million $200 million $300 million deals businesses that no one ever heard of before and there is a long list of deals ahead of that both in Europe and the US. So I don't really think there will be a big blowout deal by CRH not unless there's extraordinary value out there. Obviously, we keep our eyes open something could happen. But likelihood is it will be a continuation of the strategy of CRH that you've seen over the last two to three decades. Margins?

Yes. Good morning, Paul. In terms of asphalt margins when we look at the asphalt margin we look at the whole chain Paul. As we said we would look everything from the aggregates into the liquid asphalt into the asphalt into the paving and into the service. I think the service in others. So when you look at 2021 as we said in the business overall we managed to push margin down 20 basis points in 2021 specifically around the question of on the lag the majority of our states that we -- where we pay in the US are index link stakes. So they're linked -- the pricing is linked back into the price of the liquid. There can be a lag sometimes. But however, you see what we were able to do in 2021 still able to push on the full margin along the value chain from that perspective.

Great. Another question here from Elodie Rall in JPMorgan. How do you see US residential demand evolving in 2022, given likely rising interest rates? And do you see a meaningful recovery in non-residential demand which could offset this?

Hi, Elodie. Good morning. I hope you're well. Look, with regard to US residential, actually US residential has been robust now for about three or four years. And I think there's a couple of reasons because of that. We went through almost seven or eight years of significant underbuild. Now, I can remember times when we had 450,000, 500,000 new homes being built for a number of years in North America and the United States in a market that requires probably 1.5 million to 1.6 million new homes every year, just to feed the market, so that has not been replaced that slowdown. Inventory levels, if I talk to homebuilders in the United States, which we do quite a lot. Actually inventories are at all-time lows. So with the demand that's there, with the inventory levels that are there, you can see it in the pricing. And demand is going to continue strong. Just look at the -- in terms of what's the plan forward. The forecast for this year is 1.7 million new homes. Currently, our run rate is about 1.6 million homes. So I think it's fairly robust. I take your point in interest rates, because of course we have to watch that very carefully. But Powell has been very careful about sort of taking a slower rollout of interest rates, but I don't want to get involved in that debate. Demand is good. We're working from historic lows. And I mean 30-year fixed rates are now just a touch above 4%. They haven't really moved up all that much in recent times. And we think that will be quite robust going forward for this year for sure. With regard to non-res we're starting to see a recovery in non-res. You will have seen the ABI stats for a number of months now, have been above 50. It's good to look at that regionally. But actually, sectorally, within that, there's a little bit of a change that's taking place. We're seeing perhaps that retail and hospitality is not moving forward as it had in the past, hardly surprising. But the real growth is coming in data centers, warehouses and indeed medical. And that actually plays to our sweet spot, because data centers and warehouses are complicated buildings to build, large spans, large pre-cast units, large footprints, significant amount of stone and again plays to our solutions of specified regulators, air-conditioned, heating, all of that must be highly efficient buildings. And again that's a strong growth area for us again. So good to see the non-res coming back, but specifically coming back in the U.S. in those sectors and specifically down South and out West.

Thanks, Albert. A couple of overlapping ones here. Maybe just two briefly one on UK, backdrop in the UK at the moment and also the Eastern Europe general exposure to the area and any concerns on activity levels going forward.

Okay. Well, maybe I'll talk about the UK and maybe Jim you might give some dimension on our exposure to Eastern Europe. Maybe just give us an oversight and overview in terms of how we think about Eastern Europe at the moment, given what's going on there. First of all, in the UK, I mean, since the Brexit vote in 2016, we saw really a reluctance and a pullback on the Exchequer to fund some of the well-touted infrastructure projects that they had heretofore planned. And happily we're starting to see in 2021, at last, some of those projects, specifically High Speed Two coming to the fore and that's feeding the industry and benefits our business. And also happily, the counsel and the boroughs within the United Kingdom are getting a good level of funding from the UK Exchequer. And again, that's helping small-scale infrastructure. And that has really -- combined with a strong residential market, by the way, has really driven the performance of our business in the UK. I should say, we significantly reshaped and repositioned our business post-Brexit, because we could see there was a different demand environment evolving in front of us, even before COVID than we had thought before that. And that lower cost base that tighter business in around specific areas has also benefited our bottom line performance. And maybe before I ask Jim to talk about the dimensions of what we have in Central and Eastern Europe and indeed maybe Ukraine. I just want to talk about our own view in terms of what's happening in Central and Eastern Europe and how it affects our ability to think about that part of the world. Our own sense, well, first of all, I think we're all horrified about what's going on there. But our own sense is that, this is almost like an event, it's a catalyst that is going to pull Europe together culturally, socially and economically. And therefore we will see a continuation of the rebalancing of wealth through Europe, which is happening through the stimulus packages that are going to Central and Eastern Europe. So it will accelerate the development within Central and Eastern Europe, obviously, Poland, Romania, Hungary, Czech, Republic, Slovakia and indeed down into the Balkans should be significant beneficiaries of that as well. So we think it will redouble our efforts as Europeans to become more unified in the challenges we're faced with. With regard to our exposure there, Jim?

Sure. In Eastern Europe and taken all the way from Finland, right down to our business in Romania, we generate about $600 million of EBITDA across that Eastern Europe flank of the business. Very strong growth in 2021, building on strong growth in previous years really underpinned by strong infrastructure in that area and also good res demand also coming through. Maybe specifically on Ukraine, just in terms of scale, but we're in about Ukraine about 25 years in total and it's about approximately 1% of our business in total.

Thanks Jim. One here from Cedar Ekblom in Morgan Stanley. To consider accelerating your share buyback program after the recent pullback in your price, maybe Jim one for you.

Okay. Yes, current tranche of the share buyback is $300 million. It will finish no later than the end of this month, 30th of March this month. We're now at an annualized rate of $1.2 billion in terms of a run rate, in terms of our share buyback program. When I look at share buyback, really looking at it from a capital allocation decision, I went through it earlier. We really have -- we look at options in terms of M&A, in terms of CapEx, in terms of our dividend and also in terms of the share buyback. We exited the year at a strong balance sheet position. But right now, in terms of the geopolitical uncertainties out there in terms of inflation, in terms of interest rates, I'm quite comfortable with our balance sheet from that perspective. So -- but any capital allocation decision that we will take will always look to that critical lens of shareholder value accretion decisions.

Great. Great. Thanks Jim. Just conscious of time for everybody watching on the line, we are up against it here a little bit with a busy schedule this morning. I might just squeeze two more in if we can. And as I say, if there's any outstanding questions over the course of the day, the team and I will follow up with you directly. Two others here have come up quite a bit actually this morning around pro forma net debt levels, now comfortably below one time following the Building Envelope divestment. What do we see as normalized levels? And then maybe just a brief comment on early trading and backlogs so far this year.

Yes. In terms of pro forma net debt levels, we said through a normal cycle, right? We're quite comfortable net debt-to-EBITDA of two. At the end of December, it's a point in time. It's 1.2 times net debt-to-EBITDA. As I said, just mentioned in the last question, quite comfortable at that level and that it gives us optionality going forward as to -- in terms of what shareholder value accretion decisions we will take. And in terms...

Well, maybe I'll just take that through the early trading. Look, we're probably a visibility to the end of the first quarter at this stage. Off to a good start quite frankly, messy winter in North America, but you know what it almost doesn't matter in January and a very, very slow in the construction season, maybe down the very south and out the very west of some activity levels. But the winters in America really don't -- they stop construction really till the end of March before we start going into business. So -- but as I said the answer is in the backlogs, we said the ahead of last year on the three key metrics, quantum, margins and volumes. So, we feel pretty good about that. An early season indication, we do have some canaries in the coal mine. Early season indications in particular in our APG business are positive. So we feel quite good about the US for the first half of the year. Europe is a different situation. We've had good weather in Europe for the first half -- first quarter of the year and again good momentum in our business continuing what we saw last year and again a good start of the year. So backlogs in both business is positive, good start in Europe. Okay in the United States. It doesn't really matter at this time here. So I think we'll be okay for the first half of the year, but we're going to update you later on.

Look, Tom has just said to you that we've come to the end of our time this morning. I know it's a busy day for everybody. A lot of people at results today. We're going to update you with a trading statement in April and we've also got an investor update on the 21st of April. I look forward to talking to you then. And until then, I wish you the best and stay safe. Thank you.