Breedon Group (LON:BREE) management said the company delivered growth in reported revenue and underlying EBITDA in 2025 despite what it repeatedly described as a “testing year” across its end markets, pointing to a sharp U.K. downturn in construction materials demand, deferred infrastructure projects in Ireland, and extreme weather disruption in the U.S. The group credited more than £20 million of “self-help” from operational and commercial excellence initiatives, continued investment through the cycle, and progress against its “Breedon 3.0” strategy, including the acquisition and integration of Lionmark in the U.S.
Challenging markets, but “self-help” and investment
Chief executive Rob Wood said conditions offered “very little by way of tailwind” in all three geographies. In Great Britain, he noted ready-mix concrete volumes fell to levels “not seen since 1963.” In Ireland, two major infrastructure projects were deferred. In the U.S., extreme first-half weather affected the business, particularly in Missouri.
Financial performance: cash generation and dividend increase
Finance director James Halstead said both revenue and EBITDA increased year-over-year, aided by U.S. acquisitions. On a like-for-like basis, he said revenue and EBITDA declined slightly, though he noted “a small strengthening in profitability” in the second half.
Halstead reported a group margin of 16.3%, which he said reflected volume declines flowing through to EBITDA and the “structurally lower margin” in Lionmark. He added that like-for-like margin performance was “notably resilient,” supported by the delivery of £20 million from operational excellence initiatives.
The company’s “standout performance,” according to Halstead, was free cash flow generation of more than £133 million. He said Breedon ended the year with leverage of 1.8x, back within its target range, and described 2025 as a record post-COVID free cash flow year for the group. Halstead also said free cash conversion improved for the third consecutive year and was now ahead of the company’s target.
Underlying EPS fell 8%, which Halstead attributed to higher depreciation as major capital projects began depreciating and increased interest expense from higher borrowings. Despite the EPS decline, Breedon increased the dividend to £0.15 per share, up 3% for the year. Halstead said declared cash distributions over the five years since the dividend began exceeded £210 million.
Operational highlights by geography
Breedon discussed performance under a new segmental structure.
- Great Britain: Halstead said like-for-like revenue fell 4%, but the division broadly maintained its margin due to operational excellence. Pricing “came under some pressure” as the year progressed, though he called it more resilient than expected after four years of market volume declines. Wood said customer inquiry levels remained elevated, but orders were delayed by weak confidence and political and economic uncertainty. In cement, Wood said plant reliability improved to 97%, fossil fuel replacement reached a record 39% at Hope, and CEM II sales increased to 35%. He also confirmed the company commenced FEED on the Hope carbon capture project within the Peak Cluster.
- Ireland: Management described the operating environment as more positive than Great Britain, citing Irish GDP growth of 12.3% in 2025 and modified domestic demand up 4.9%. Wood said revenue strengthened through the year, though performance was impacted by the deferral of two major infrastructure projects and more muted activity in Northern Ireland, where spending is more dependent on central government. Breedon also exited a non-core street lighting business. At Kinnegad, Wood said cement plant reliability was 95% and fossil fuel substitution reached 82%, with periods at 100%. CEM II sales rose to 67%.
- United States: Halstead said a full-year contribution from BMC and an initial contribution from Lionmark drove a significant increase in reported U.S. revenue and EBITDA. On a like-for-like basis, he said revenue increased 9% and EBITDA was broadly flat. Wood emphasized that Lionmark added asphalt and surfacing capabilities to Breedon’s aggregates and concrete base, creating a more vertically integrated platform in Missouri. He said the integration with BMC was substantially complete and the company remained on track for stated synergies. Management said infrastructure spending remained comparatively resilient, while residential demand stayed subdued due to affordability. Wood also recapped severe weather, noting St. Louis had 31 days below freezing in January and February versus nine days in 2024, and that April was the wettest month in more than 100 years.
Pricing, cost outlook, and operational excellence into 2026
Asked about 2026 cost savings, Halstead said about one-third of the £20 million operational excellence benefit achieved in 2025 would “repeat” into 2026, providing a tailwind. He added that around 20% of the 2025 benefit (about £4 million) came from targeted, site-specific initiatives examining production processes end-to-end, and said similar programs were already identified for additional sites in 2026.
On early-year trading, management said January and February are typically quiet across all platforms and that the group was trading generally in line with expectations, while noting more normal Midwest weather versus last year as a positive.
On pricing, management said it did not expect much pricing improvement in Great Britain until there is a “meaningful market volume recovery,” while suggesting Ireland could see some price opportunity and the U.S. was “generally and historically” conducive to pricing. Wood added that energy and fuel represent about 8% of the group’s cost base, which he said reduces exposure relative to some peers.
Capital allocation, M&A, and policy issues
Management said Lionmark was earnings-enhancing in its year of acquisition and that the company had “good line of sight” to committed synergies. Looking to 2026, Wood and Halstead said M&A in Great Britain and Ireland would likely be bolt-on in nature, and that U.S. activity was also expected to skew toward bolt-ons given the platform build-out is ahead of schedule. However, they said the company could not provide definitive guidance on M&A spend because it requires willing sellers.
On leverage, Halstead said that absent M&A he would expect further deleveraging in 2026, though “probably not” to the same magnitude as 2025.
Breedon also discussed working capital benefits from selling surplus U.K. carbon allowances. Halstead said the sales began in “the tail end of the summer” and continued through the remainder of the year, reflecting improved liquidity in the U.K. market. He said the company retained about the same number of credits on the balance sheet afterward and therefore still had the option to sell more in the future.
On cement policy in Great Britain, Wood said the company is advocating for a “level playing field,” highlighting concerns about uneven carbon regulation, high energy prices, and imports. In Q&A, he said the EU CBAM is operating, while the U.K. has committed to a scheme in 2027, and that the company wants clarity on the legislation. Management said it remains in discussions with government and industry groups but does not yet have clarity on the 2027 framework.
For 2026, Halstead said he expects a similar first-half/second-half split for group revenue and EBITDA as in 2025, with the U.S. more heavily weighted to the second half. He also said the group expects to incur “single-digit millions” of decarbonization-related costs in 2026, which will be treated as non-underlying.
About Breedon Group (LON:BREE)
Breedon Group plc, a leading vertically-integrated construction materials group in Great Britain, Ireland and the USA, delivers essential products to the construction sector. Breedon holds 1.5bn tonnes of mineral reserves and resources with long reserve life, supplying value-added products and services, including specialty materials, surfacing and highway maintenance operations, to a broad range of customers through its extensive local network of quarries, ready-mixed concrete and asphalt plants.
