Breedon Aggregates trading update

Company says anticipated trading results for 2011 comfortably in line with market expectations

IN a statement issued in advance of their preliminary results announcement, due on 6 March 2012, Breedon Aggregates Ltd say their anticipated trading results for the year to 31 December 2011 remain comfortably in line with market expectations, assuming normal weather conditions in December.

Sales volumes have held up well during the year, with growth across all product groups in both Scotland and England, including a positive contribution from C&G Concrete. Sales revenue for the 10 months ended 31 October 2011 increased by 20% to £153 million, including £4.9 million from the former C&G business, compared with pro forma 2010 revenues of £127.7 million.

According to the company, good progress has been made in addressing all the main operational issues identified at the start of the year; the English contracting business has returned to profit; numerous asset disposals have been completed; and the Group’s mineral reserves have been substantially increased. Most notably, all key raw material cost increases have been recovered during the year.

However, with forecast growth in the economy slowing down, Breedon described the outlook for 2012 as uncertain, although the increases in English housing and infrastructure spending announced recently by the Government should have a positive impact on demand for the company’s products in the medium term.

Moreover, Breedon’s directors continue to believe that there is significant scope to further develop the Group, and that current market conditions will inevitably create further opportunities to purchase assets at realistic prices. Several acquisition opportunities are currently under review and the board says it has every expectation of making further progress in the year ahead.