Breedon completes another acquisition amid ‘strong’ performance update

breedon-logo_11Building materials group Breedon has agreed the purchase of independent heavyside building materials business Sherburn Minerals Group for £15.7 million.

Sherburn operates four quarries and five ready-mixed concrete plants in Durham, Northumberland, North Yorkshire and Cumbria. It also distributes cementitious products from two import terminals at Blyth and Dundee.

Sherburn reported an underlying EBITDA of £1.8m on revenues of £16.1m in the year to 31 March 2016. It has in excess of 21 million tonnes of mineral reserves and resources, together with significant cement storage capacity at its two terminals.

Breedon chief executive, Pat Ward, said: “Following our acquisition of Hope earlier this year, which significantly expanded our geographical footprint in the north of England, Sherburn is a perfect infill acquisition for us. It gives us additional mineral reserves and access to new markets for our aggregates and concrete, as well as a first-rate workforce.

“It also complements our existing cement plant at Hope and will enable us to expand our cementitious business through the importation of cement and ground granulated blast-furnace slag (GGBS) through Sherburn’s two strategically located terminals in north-east England and eastern Scotland.”

Breedon also provided a trading update showing an increase in volumes and revenues for the former Breedon Aggregates business in the 10 months to 31st October 2016. Including Hope Construction Materials, group sales volumes of aggregates increased by 25 per cent, asphalt by 1 per cent and concrete by 96 per cent.

Total group revenue for the 10-month period increased by 31 per cent to £361m.

The integration of Hope is progressing well, “with synergies coming through earlier than had previously been expected,” the company said.

Underlying profits for the full year are therefore likely to be ahead of expectations, barring any December disaster.

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