Irish building group CRH hikes dividend by 15%

DUBLIN, Feb 28 (Reuters) - CRH, hiked its full year dividend by 15% on Friday after strong organic growth and the impact of a major acquisition drove profits 25% higher year-on-year at the cash rich Irish building group.

The world's second-biggest building materials supplier by market value reported core earnings of 4.2 billion euros, the first full year that it has benefited from its $3.5 billion acquisition of U.S. cement maker Ash Grove Cement.

Excluding the contributions from recent acquisitions and currency fluctuations, like-for-like earnings grew by 7%. CRH had flagged in November that it expected earnings in excess of 4.15 billion euros.

CRH, which embarked on its first share buyback programme in a decade in 2018 and generated 3.5 billion euros of cash last year, announced a full year dividend of 85 euro cents per share, up 15% year-on-year.

That compared to a 6% increase in the dividend in 2018 and 5% increase in 2017

"15% is a big hike in terms of dividend and that really is a reflection of our confidence in the sustainability of both the profit and cash generation capability of the company going forward," CRH Group Finance Director Senan Murphy told Reuters in a telephone interview.

With the latest round of share buybacks running up until the end of March, Murphy said CRH continued to consider the buybacks an ongoing programme.

The fresh record level of annual profits were driven by a 10% year-on-year rise in its Americas materials division, where CRH is the biggest producer of asphalt for highway construction.

Like-for-like earnings at its building products and Europe Materials divisions rose by 2% and 5%, respectively.

CRH provided a positive outlook for each of the three divisions as it forecast that 2020 "will be a year of further progress for the group."

(Reporting by Padraic Halpin; editing by Philippa Fletcher)