Readymix profits down 65%

Cement manufacturer Readymix expects 2007 operating profits to be 65 per cent below the €19.6 million reported in 2006 as a result of the building slowdown. In a trading statement issued ahead of its annual results release on March 3rd, Readymix warned that the building slowdown and the sale of part of its business hit profits last year.

It said due to the fall-off in house building and construction activity, loss of earnings from the sale of its concrete business and once-off costs associated with new accounting systems, 20007 operating profits would be about 65 per cent below 2006.

Readymix had €19.6 million operating profits in 2006. It added that group profit before tax would be 35 per cent below the €42.6 million achieved two years ago.

"During 2007, the company invested €24 million in strategic projects that will be important to the future growth of the core businesses. The company ended the year with cash balances of €37 million," the statement said.

"While it is expected that the very tight trading conditions in the housing and construction sectors will continue throughout 2008, the board believes there are opportunities to improve on the 2007 operating results."

Last year the group took steps to cut its exposure to residential building. It announced the closure of a manufacturing facility in Naas, Co Kildare, with the loss of up to 50 jobs. It also sold its Finlay Breton ready-mixed cement business to Tyrone-based Acheson & Glover for €49 million. Readymix then signalled it intended switching its focus to meeting demand from projects such as road and rail building.