Breedon Aggregates (BREE) delivered a robust first-half performance, pushing turnover up by 25 per cent to £125m, and underlying pre-tax profits by 77 per cent to £9.4m. The UK's largest independent quarrying business sold 3.6m tonnes of aggregates, up from 2.7m a year earlier, while ready-mixed concrete sales jumped from 283,000 cubic metres to 326,000.
Turnover was boosted by the inclusion of quarries acquired from landscape specialist Marshalls (MLSH), and there was also one month's contribution from Huntsman's Quarries which was bought on 1 June for £15m. In addition, agreement has been reached with the Competition & Markets Authority allowing the full integration of former Aggregate Industries operations acquired in Scotland, and this will allow the company to crystalise cost synergies identified at the time of the acquisition.
And while first-quarter revenue was up against some weak comparatives, which reflected the poor weather conditions in the previous first quarter, the trading climate has improved significantly as the construction sector continues to recover. And this enabled Breedon to rebuild margins by pushing through above-inflation price increases.
Group finances have also been strengthened with a new four-year £100m revolving credit facility, with an option for a further £50m. The new facility replaces the existing facility due to expire in 2015, and was secured on cheaper terms.
There was also good underlying demand in Scotland, with the Aggregate Industries acquisition expected to boost growth still further. But the rate of growth in the first half was not as strong as in England, with the pending Scottish referendum generating some uncertainty.
