CRH’S SHARE price fell by just under 5 per cent yesterday on the London stock exchange following the release of its interim results.

The Dublin-based building materials group said its earnings this year would be flat at best, due largely to continued weak demand in Europe.

This resulted in analysts trimming their forecasts for the company by up to 5 per cent.

In the six months to the end of June, CRH’s Ebitda (earnings before interest, tax, depreciation and amortisation) declined by 1 per cent to €568 million.

This had been flagged by the company in early May.

Revenues in the first half of the year rose by 5 per cent to €8.59 billion but four-fifths of the increase was due to foreign exchange gains from a stronger dollar.

CRH’s pretax profit rose by 23 per cent to €117 million, helped by a €196 million gain from the sale of its 49 per cent stake in cement maker Secil in Portugal, and the disposal of its German access control business.

There were contrasting performances from its European and Americas divisions. In Europe, sales declined by 5 per cent to €4.6 billion while its Ebitda fell by 13 per cent to €352 million.

In the Americas, milder weather in the period resulted in some construction activity in the US being brought forward. This helped to boost its Americas revenues by 20 per cent to €4 billion and its Ebitda by 26 per cent to €216 million.

Chief executive Myles Lee said the euro zone crisis continues to “erode consumer and business confidence” in Europe.

“It will continue to be tough in Europe in the second half of the year,” he added.

In the US, the “good early momentum” in construction demand from the milder weather is likely to be “tempered” by a slowing in economic activity over recent months, the company said.

“Against this backdrop, we expect that Ebitda for the year as a whole will be similar to last year’s level,” he said. CRH posted Ebitda of €1.65 billion in 2011.

In relation to Europe, Mr Lee said actions to tackle the currency crisis, which are expected from policymakers this autumn, will be crucial in trying to restore confidence and stability to the region.

While CRH is heavily exposed to Europe, Mr Lee highlighted how it has exited businesses in Portugal and Italy, and scaled back its activities in Ireland and Spain. It also has no exposure in Greece.

Ireland and Spain now account for about 3 per cent of its sales compared with about 10 per cent before the global financial crash.

He said this represented a “modest” exposure for the group.

When asked what contingency plans CRH had made in the event of the euro collapsing or a shock to the system from one or more member countries being removed from the currency, Mr Lee said it no longer maintains large amounts of cash in euro.

Instead, it puts its money – usually tens of millions – into dollars or sterling over weekends. It no longer deposits significant cash amounts with Irish banks due to their poor credit ratings. “These are shareholders’ monies so we have to be careful where we deposit them,” Mr Lee said.

CRH said that its ongoing cost-reduction programme had yielded incremental savings of €50 million in the first half of 2012, to bring its cumulative annualised savings to €2.1 billion since 2007.

It is now looking at an additional programme of cuts to its European cost base.

Mr Lee said that the company would have a fix on this in the next month or so and didn’t rule out further cuts in Ireland and elsewhere in the region.

CRH currently employs about 700 staff in Ireland, which is about 50 per cent below the level of employment that prevailed before the crash.