CRH believes it is better positioned now to deal with the continuing high oil price, which added some €50m to its cost base in 2004.
Chairman Pat Molloy, speaking at yesterday’s agm in Dublin, said the impact on the business depended on the extent to which it was able to pass on any increase. "So far in 2005 we have had more success in passing cost on," he told shareholders.
The group recently increased its cement price in this country by circa 7pc, as did some of the other producers. The key market, as far as CRH is concerned, is the US, and chief executive Liam O’Mahony suggested after the meeting that companies like CRH had now adjusted to higher prices. "I think we all know it’s going to be with us for the future," he said in relation to the $50 oil price.
He said the group remained as active on the search for new acquisitions despite a relatively modest €100m spend on 15 buys in the opening four months of 2005. "We’re finding it has been a bit slower to close deals," he explained, but was unable to say why exactly.
He continued to play down the group’s long-term intentions for the Chinese economy. CRH has a couple of "small investments" but has been slow to really take the plunge. "A lot of people rushed in," he remarked.