Readymix PLC, the building materials company which has operations in Brinny, Carrigtohill and Mallow, Co Cork say the business is expecting a loss of €3.9 million for the first quarter of 2008.

The announcement came as Readymix PLC issued its first Interim Management Statement in accordance with the reporting requirements of the Transparency Regulations 2007, which the Chairman, Adrian Auer, presented at its Annual General Meeting this week.

The building materials company attributed the loss to the sharp deceleration of activity within the construction sector which has subsequently lessened demand for their products and has contributed further to the challenging trading conditions experienced in the latter half of 2007 and into 2008.

Included in this estimate is a €1.8 million loss from the sale of plant and machinery associated with the closure of the pipes and tiles business unit. Volumes during the quarter have been affected by a combination of the continued weakness in the residential sector and a reduction in operational days due to the earlier Easter holidays.

As a result of recent market developments, the Group has completed an optimisation programme which included the rationalisation of assets to improve efficiency, lower operational overheads and reduce personnel costs.

The Group however also reported a strong balance sheet and a healthy cash position and in slowing markets, this financial strength, they say, can be used to their advantage. Following a period of consolidation and strategic acquisitions, the management team has achieved major goals in repositioning the Group for long term growth. During the first quarter, the Group acquired aggregates reserves in Co Offaly, for €12.75 million in cash.

The integration of Denis Tarrant & Sons, purchased in November 2007 is now complete and providing cost synergies to our southern region. In November 2007, the Group acquired a modern ready-mixed concrete plant in Co Tyrone, which has enhanced our presence in the North West whilst delivering operational cost reductions to that region. In the Republic of Ireland, three new technologically advanced ready-mixed concrete plants are currently under construction. They will improve our ability to serve large infrastructure projects whilst reducing operational overheads.

Tough trading conditions are expected to remain throughout 2008, resulting in a continued downward pressure on margins. New infrastructure projects have not commenced as quickly as had been expected and demand in the housing sector continues to decline. Against this challenging background, the priorities for the Board are cost management and to focus it's investment programme on projects to deliver efficiency savings and improved products.

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