00:00Jim, it's great to see you.
00:01Great to be here, Katie. Romain?
00:02Let's talk about the hot topic of the past year or so, even more than that, data centers.
00:08Because on the call, your COO mentioned that currently you're involved in over 100 data center projects across the U
00:15.S.
00:16And I'm curious, I mean, especially with the state of the equity market right now,
00:20what would you say is the sustainability of that demand, which up to this point, of course, has been quite
00:25high?
00:26Yeah, we're active on over 100 data centers right now.
00:30If you think, actually, 85% of every data center at the moment in the U.S. is within 25
00:35miles of one of our facilities.
00:37So it's an important part of our business within our re-industrialization segment.
00:43So for us, Katie, you know, we're a bit maybe different to some of our peers.
00:48We supply the building materials into the construction of it.
00:51Construction is estimated to account for about 15% of the total cost of a data center.
00:56Now, what we do is that we're often very first on site, because if you think about the water, energy,
01:01communications infrastructures that have to go in to support the data center,
01:05that's our first part of the project.
01:07So we come in with a lot of subterranean concrete structures that support the critical services.
01:11We then come on our aggregates, our concrete, and ultimately pave the road, the asphalt in and out.
01:16So it's a busy part for us.
01:19We've got good visibility, you know, out for certainly for 26 and probably internally 27.
01:23We're certainly busy in terms of our backlogs.
01:26Well, that's exactly where I wanted to go.
01:28And it's the question of visibility, certainly top of mind for investors.
01:31You mentioned 2026, 2027, pretty good visibility there.
01:35Beyond sort of that 12-month time frame, do you still have that good measure of visibility or is it
01:42a little bit more murky?
01:43Yeah, I would say it's good visibility probably out to the first half of 27.
01:47Again, for us, you know, in CRH, by far and away our biggest exposure is infrastructure, right?
01:52So within the reindustrialization space, data centers, and indeed, you know, complex manufacturing with chip plants, that's where we're busy.
02:00They tend to be maybe more kind of multi-year projects, maybe two to three-year projects.
02:03And for us, particularly around, say, a lot of the complex reshoring and manufacturing, the building of the plant itself
02:10is fantastic.
02:10But actually, we see time and time again it's the fill-out of the, you know, the facilities around it,
02:15the residential, the retail around that.
02:17So we kind of get a boost for maybe, you know, three, four years post the facility itself afterwards.
02:22So, yeah.
02:24I am curious, though, what about the transportation side right now?
02:27And I am curious, mainly because we've seen some fits and starts in certain projects, primarily because of issues with
02:31federal funding and the continuity of it.
02:33Has that affected you at all?
02:34It hasn't at all, Romain.
02:35No, no.
02:37Clearly, we're, from a federal funding perspective, the IIJ bill, there's only about 50 percent of that, from a highway
02:44perspective, actually hit the street at this stage, right?
02:47So there's going to be a long tail on that.
02:48Now, that bill expires this year, right?
02:51But already in Washington, there's good discussions going on, both in the House and in the Senate, right, with Chairman
02:57Graves and Chairwoman Capito on that.
02:59We've got Secretary Duffy, who's quite supportive of a new multi-year highway funding program.
03:03And typically, infrastructure funding has been, you know, bipartisan support.
03:07So, you know, we're quite hopeful there'll be a bill this year.
03:10If there's not, you know, we've kind of, unfortunately, we've been here before a number of times, you get a
03:14continuing resolution.
03:15But for us, the continuing resolution steps off a record year this year for federal funding.
03:20So it's a good place to start.
03:21So the outlook on infrastructure funding for 26 and 27 is good, right?
03:26And actually linking it back to the last discussion.
03:29I mean, you know, to have all these data centers and, indeed, complex manufacturing is great.
03:33But if the infrastructure support isn't there to support that, that's a key part of it, too.
03:38I do have to ask you about your costs and particularly some of the inflation that we've seen in aggregate
03:43materials.
03:43Is that still rising?
03:45Is that under control?
03:46Is that hedged?
03:47How does that work for you?
03:48Yeah, we are the biggest producer of aggregates in the U.S., right?
03:51And we own more rock than any company in the U.S. as well.
03:54So for us, in terms of our main input costs around labor, around, you know, external services and maintenance parts,
04:01we're continuing to get inflation in that, you know, in those particular areas.
04:05Right.
04:05Now, we're looking forward to 2026 for our own price increase to recover that inflation of kind of mid-single
04:11digits.
04:11Is that one side offsetting the other?
04:14That, together with kind of performance initiatives, is offsetting it.
04:17And we'd be looking forward to another year of margin expansion, yes.
04:20I also want to talk about your M&A strategy because you've been particularly acquisitive.
04:25I think you completed close to 40 deals last year.
04:28The number expands to something like 100 over the past three years.
04:31Do you plan to keep up that pace?
04:34And if so, what sort of areas are you looking at?
04:37Yeah, we do, Katie.
04:38I mean, 38 is not unusual for us, right, in terms of a run rate.
04:41We did 4.1 billion in the year, and the largest was the eco-material deal in September.
04:47We set out in our investment day a few months ago that we had a financial capacity of about $40
04:51billion out to 2030.
04:53We expect to invest about 70 percent of that on the growth side.
04:56Where we will invest it is in the faster-growing markets within Zerhade, so kind of south and west U
05:02.S., also central, eastern Europe, but then within our four key platforms.
05:06So that's within aggregates, cementitious, water, and roads.
05:10So that's where you should expect us to invest.
05:12And the pipeline's good.
05:13You know, on the back of the 38 deals last year, the pipeline into 26 is good.
05:17We've got good optionality.
05:18I do have to ask you about your multiple listings, if you will.
05:22Obviously, you trade here.
05:23The U.S. shares are doing well.
05:24There's a big disparity between the value of your shares here and the value of your shares on the London
05:29Stock Exchange.
05:30Are you planning to delist any time soon?
05:31Yeah, we announced this morning, Romain, that we're undertaking a review of our listing in London.
05:35We listed about just over nearly two and a half years ago in the U.S., in NYSE.
05:41It's gone very well, right?
05:42But our daily trading volumes at this stage is kind of high 90 percent, so we're in New York.
05:47So we'll undertake a review over the next number of weeks and come back to you on that.
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