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Revenue: Reported revenue increased by 5%, with like-for-like revenue up approximately 3%.
Underlying EBITDA: Flat compared to 2025, slightly ahead on a like-for-like basis.
EBITDA Margin: 13.5%, slightly lower than the prior period.
Free Cash Flow: Outflow of approximately GBP15 million, an improvement from the GBP25 million outflow in the first half of 2025.
Net Debt (Guidance): Expected to be around GBP650 million for the full year.
Covenant Leverage: 2.1x.
Dividend: Interim dividend increased.
GB Revenue: Flat, with surcharges balancing marginally higher costs.
Ireland Revenue: Strong growth with volume and price up mid-single digits.
US Revenue: Strong like-for-like performance, up in the mid-teens.
US EBITDA: Up in the mid-teens on a like-for-like basis.
CapEx Guidance: Increased to GBP125 million to GBP135 million.
Working Capital (Guidance): Expected year-on-year outflow of between GBP20 million and GBP30 million.
Cash Dividend Payments: Total of GBP55 million to be paid in the second half.
Cash Exceptionals (Guidance): Between GBP10 million and GBP15 million.
Release Date: July 29, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Breedon Group PLC (BRDNF) delivered a solid first-half performance with reported revenue up 5% and like-for-like revenue up 3%, the first like-for-like growth in a first half since 2023.
Strong momentum in Ireland and the US offset continued market challenges in GB, with the US business posting like-for-like revenue and EBITDA growth in the mid-teens.
The company successfully managed the short-term impacts of the Middle East conflict on energy costs through hedging programs and pricing actions, minimizing the financial impact.
Breedon Group PLC (BRDNF) completed two strategically compelling, earnings-accretive acquisitions in the US and Ireland at attractive valuations, expanding its footprint.
The company increased its interim dividend, reflecting confidence in long-term prospects and strong cash generation, despite a challenging market environment.
Negative Points
GB market demand is expected to decline for the fifth consecutive year, with residential weakness particularly impacting ready-mix concrete volumes, which fell 8% year-on-year.
Underlying EBITDA was flat year-on-year, and the EBITDA margin dipped slightly to 13.5%, impacted by lower profitability in GB and an unscheduled cement mill shutdown in Ireland.
Post-tax return on invested capital remains lower than desired, diluted by short-term acquisition impacts and absolute profitability levels.
The Irish cement mill shutdown in May resulted in an estimated net opportunity cost of a couple of million pounds in EBITDA, impacting first-half margins.
Pricing in GB remains challenging, with no real price increases expected in 2026; any pricing is limited to surcharges due to a weak and declining market.
Q & A Highlights
Q: Can you comment on the trends in GB, particularly around energy costs and how you are dealing with them? Are the surcharges sticking, and what are the underlying pricing dynamics for H2?A: James Brotherton (CFO): There has been significant volatility in energy costs in the first half, which we have managed through surcharges. The narrative is inconsistent, as customers are more reluctant to accept surcharges when the oil price is falling. We are staying close to customers and trying to be fair, recovering increased costs without overexploiting volatility. We are not expecting any real pricing in the GB market across all product sets in 2026, as a stable market is a prerequisite for securing pricing, and ready-mix concrete volumes are down 8% from multi-generational lows.
Q: What is the competitive landscape in GB, specifically regarding pricing and imports on the cement side?A: Robert Wood (CEO): Cement imports have been increasing, with the last statistic showing over 30% of the market is imports, partly due to the UK being naturally short on production capacity. The most important factor is the UK CBAM (Carbon Border Adjustment Mechanism). The government has reconfirmed its commitment to implementing it from January 2027, which is critical for creating a level playing field. Without it, UK producers face higher costs for carbon and electricity. Our cement business performance in GB was comparable to the first half of last year.
Q: Are you seeing more M&A opportunities in the US now that you are active there, and how do you balance that with current leverage levels?A: Robert Wood (CEO): There are significant opportunities in the US, and our focus is predominantly on bolt-on acquisitions. We believe we have the capacity to continue doing bolt-ons. James Brotherton (CFO): Our leverage at the half-year is broadly in line with last year, and we have a well-defined working capital cycle that provides scope for bolt-on acquisitions off the balance sheet. The timing depends on finding willing sellers, and our success with Falling Springs was due to the team’s long-standing knowledge of the asset.
Q: What is the outlook for cost savings and operational excellence in GB? Are there plans to take more costs out?A: James Brotherton (CFO): The cost-saving programs continue, with the first half benefiting from tailwinds from 2025. We are continuing a targeted approach with a smaller number of dedicated projects, expecting some results in the second half. However, we do not want to compromise the recovery. We fundamentally believe markets will improve, and we want to be in the best position to take advantage, as highlighted by the significant Scottish renewables opportunity.
Q: On the US, the like-for-like growth was very strong in H1, partly due to weather comps. What is the underlying step-up, and what should we expect for H2?A: James Brotherton (CFO): It is difficult to disentangle whether better activity is due to weather or an underlying pickup, but it is genuinely both. For example, Lionmark’s winter losses were significantly lower due to a milder winter. In a more normal weather year, the US business performs well. The key question for H2 is when winter arrives; if deferred, the business can trade into mid-December, but an early winter would halt construction activity until spring.
Q: You mentioned the opportunity cost from the unscheduled cement mill shutdown in Ireland. Is that a couple of million pounds in EBITDA or revenue?A: James Brotherton (CFO): That is an EBITDA impact. In May, when the mill was down, we made a distribution margin on cement but did not make the manufacturing margin. The repair was completed on a timely basis, and we do not expect any further impact this year.
Q: Regarding vertical integration in the UK, are there any areas where you are short on exposure and want to expand? And for the US, is the focus solely on the Midwest?A: Robert Wood (CEO): In the UK, there is white space where we want to grow, and further vertical integration is likely to be more into concrete products. For the US, our ambition is to base ourselves in Missouri but include the broader Midwest, which includes neighboring states. The appendix provides a feel for the opportunity in those surrounding states.
Q: Can you provide an update on the decarbonization exceptional costs? How long should we expect them to continue, and what is the catalyst for them to become underlying or capitalized?A: James Brotherton (CFO): We expect a similar charge to this year over the next five years for Peak Cluster and related projects. All large-scale decarbonization projects have had governmental or super-governmental support, and we continue to advocate for appropriate support. Robert Wood (CEO): The real prize is delivering significant decarbonization of our cement in advance of a decision on carbon capture, through business-as-usual actions like increasing alternative fuels and reducing clinker factor.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.