Breedon interim results: US and Ireland growth offsets another tough GB half

Breedon's geographic expansion is earning its keep. Growth in Ireland and the United States offset another difficult period for British construction, allowing the group to increase first-half revenue and maintain its full-year guidance.

The headline numbers were mixed rather than spectacular. Revenue rose 5% to £857.9 million, including 3% like-for-like growth, but underlying EBITDA was broadly flat at £115.5 million. EBITDA means earnings before interest, tax, depreciation and amortisation, and is commonly used to assess operating performance.

Margins narrowed, earnings per share fell and net debt increased following further acquisitions. Even so, the board increased the interim dividend by 5% and continues to expect 2026 performance in line with market expectations.

Investors can read the original company announcement or visit the dedicated Breedon Group PLC share page for ongoing coverage.

Breedon's key first-half figures

Metric	H1 2026	H1 2025	Change
Revenue	£857.9 million	£815.9 million	+5%
Underlying EBITDA	£115.5 million	£115.0 million	Broadly flat
Underlying EBITDA margin	13.5%	14.1%	-0.6 percentage points
Underlying profit before tax	£41.3 million	£48.9 million	-16%
Statutory profit before tax	£26.7 million	£34.9 million	-24%
Adjusted underlying basic EPS	9.4p	11.2p	-16%
Statutory basic EPS	7.4p	8.0p	-8%
Interim dividend per share	5.00p	4.75p	+5%
Net debt	£690.5 million	£648.1 million	+7%
Covenant leverage	2.1 times	2.2 times	Improved by 0.1 times

The central issue is the gap between revenue growth and profit growth. Breedon sold more, but underlying EBITDA barely moved and its margin declined from 14.1% to 13.5%.

Higher depreciation and amortisation charges also contributed to statutory profit from operations falling by £7.1 million to £41.6 million. Meanwhile, increased debt following acquisitions pushed net interest costs up from £13.8 million to £14.9 million.

Great Britain remains the weak spot

Great Britain generated revenue of £556.3 million, broadly unchanged from £556.8 million. Underlying EBITDA declined 3% to £81.1 million, with the margin slipping from 14.9% to 14.6%.

The performance varied considerably by product. Aggregates and asphalt showed signs of stabilisation and benefited from major infrastructure project wins. Ready-mixed concrete remained much weaker, however, with volumes down another 8% because of subdued residential construction.

This matters because Great Britain remains Breedon's largest operation by some distance. Improvements elsewhere can soften the blow, but continued weakness in the group's home market still weighs heavily on overall profitability.

Management expects British demand to decline for a fifth consecutive year in 2026. Infrastructure spending should offer some support, but the timing and pace of a broader construction recovery remain unclear.

Ireland delivers growth, but the margin takes a hit

Irish revenue increased 12% to £154.3 million, including like-for-like growth of 9%. Underlying EBITDA rose by a more modest 3% to £27.9 million, while the margin dropped from 19.8% to 18.1%.

Construction activity improved in the Republic of Ireland, including work on major projects delayed from 2025. Breedon also reported positive pricing across its main product categories.

The margin decline was partly caused by an unscheduled shutdown of the Kinnegad cement mill during May. The mill has returned to full capacity, and management does not expect the disruption to affect the second half.

Breedon expects both revenue and earnings growth from Ireland in the second half, supported by rising construction activity and infrastructure investment.

US growth is becoming increasingly important

The strongest operating performance came from the United States. Revenue climbed 20% to £152.2 million, with like-for-like revenue up 13%. Underlying EBITDA increased 6% on a reported basis and 14% like-for-like.

More favourable Midwest weather supported construction activity, while pricing and volumes improved across all products. Infrastructure and non-residential demand remained healthy, although residential demand was slightly softer.

The reported margin fell from 10.2% to 9.1%, partly because Breedon included two loss-making winter months from Lionmark for the first time. On a like-for-like basis, however, the margin improved by 0.2 percentage points.

Breedon entered the second half with healthy backlogs and has secured initial material supply wins for data centre projects. The company is also involved in several substantial tender processes in that market, although the potential financial contribution was not disclosed.

Acquisitions offer growth, but increase financial demands

Breedon deployed around £110 million on bolt-on acquisitions in the US and Ireland during the period.

The largest deal was Falling Springs, acquired for an enterprise value of approximately £90 million. The asset includes a highly automated quarry with 185 million tonnes of limestone reserves, located around 15 minutes from downtown St Louis.

Breedon also acquired Booth in Ireland, securing sand and gravel reserves within reach of Dublin, and completed a smaller aggregates transaction in Missouri that added 5 million tonnes of reserves.

These deals contributed £6.1 million of revenue and £1.5 million of underlying EBITDA during the period. Had they all completed on 1 January, Breedon said first-half revenue would have been £869.3 million and underlying EBITDA £120.4 million.

The strategic logic is clear from the announcement, but acquisitions bring integration risk and place more pressure on the balance sheet. Post-tax return on invested capital declined from 7.8% to 7.0%, reflecting short-term dilution from recent deals and current profitability levels.

Cash flow, debt and the dividend

Free cash flow was an outflow of £14.6 million, improving from a £25.0 million outflow in H1 2025. The first half typically includes a seasonal working capital build, and Breedon expects cash generation to support further deleveraging during the second half.

Net debt increased 7% to £690.5 million, including lease liabilities. Covenant leverage nevertheless improved from 2.2 times to 2.1 times and remained below the 3.0 times covenant threshold.

The interim dividend increased 5% to 5.00p per share. It will cost £17.4 million and is due to be paid on 6 November 2026 to shareholders on the register at 2 October.

One detail worth watching is the payout ratio. It rose from 42% to 53%, moving above Breedon's financial framework target of 40%. The increase signals confidence, but it also means the dividend is consuming a larger share of underlying earnings while the group is investing and carrying higher debt.

What investors should watch next

Breedon maintained its full-year guidance, with company-compiled analyst consensus pointing to 2026 underlying EBITDA of £280 million, within a range of £273 million to £285 million.

The positives are clear: Ireland and the US are growing, the Kinnegad disruption appears temporary, acquisitions should make a larger second-half contribution, and covenant leverage remains manageable.

The less comfortable points are equally visible. British demand remains weak, group margins have narrowed, underlying earnings per share fell 16%, return on invested capital declined and net debt increased.

Breedon's diversification is therefore working as intended, but it is not yet producing strong group-wide profit growth. The second half needs continued momentum from Ireland and the US, disciplined acquisition integration and better cash conversion if the group is to deliver its outlook while bringing leverage down.