Chief executive Liam O'Mahony last week played down suggestions that the company is the most upbeat it has been since 1999, but analysts remain confident that CRH will deliver another strong set of figures in 2006. Even though CRH is trading at a significant premium to its price a few months ago, last week's results suggest that it could still represent a decent investment.

The company posted record figures. Turnover rose by 13% to almost 14.45bn and operating profit was up by 14% to 1.39bn. Most of the growth was generated organically, rather than from acquisitions.

Growth in the US market, where CRH offset rising energy costs by boosting the price of its products, was particularly strong.

CRH also tempered its traditionally conservative outlook with indications that it believes Europe may be on the up, though O'Mahony questioned the wisdom of interest rate hikes. "I'm quite concerned about the raising of interest rates, " he said.

"When you look at factors such as the long-term unemployment levels and the lack of economic growth, then I just wonder are the leaders thinking things through correctly."

Some of CRH's European markets would have the capacity to absorb higher interest rates before those who have over-extended themselves would be affected, he said. "But there's also a risk, if there is accelerated growth coming in Germany, of killing it."

On the other hand, rising interest rates may make it easier for CRH to target acquisitions. He suggested that private equity houses may have to re-evaluate potential acquisitions in a higher interest rate environment, leaving more scope for CRH.

Low interest rates have been enticing private equity houses to snap up targets CRH may otherwise have secured.

Should a European recovery secure a foothold, CRH is in a strong position to benefit. It does not have a significant presence in Germany, but the impact of that economy reverberates across the continent - and, most importantly, across CRH's single busiest European market, the Netherlands and parts of the Benelux. CRH does about 2bn in sales in the Netherlands. For the past three or four years, the market in the Netherlands has been very weak, O'Mahony said. "The housing market has been weak and the consumer side has also been relatively weak." The company owns 50% of a Dutch operation that controls over 200 DIY stores.

Analysts such as NCB's John Sheehan remain positive on CRH, citing the company's strong performance momentum. Last week Sheehan raised CRH's earnings per share forecast for 2006/7 by between 2-3%, and maintained a 'buy' rating. Threats to the stock remain from a general economic slowdown, he said, but CRH has previously shown an ability to "manage such challenges more effectively than its peers".

John Mattimoe of Merrion Stockbrokers also reiterated his 'buy' recommendation, and said that CRH has "returned to a sustained period of stronger earnings growth from the 2001-03 slowdown". CRH's share price has risen by 30% in the past 12 months, and by 8% so far this year.

SALES RISE BY 80% AT CAVAN-BASED KINGSPAN

IT WAS a week for building materials, as Cavan-based Kingspan also released healthy 2005 results that will have pleased investors. The company said sales rose by 30% to over 1.24bn, while operating profit was up 40% to over 145m.

Chief executive Gene Murtagh was making expansionary noises last week.

Kingspan already has two manufacturing sites in the UK, in Newcastle and Cardiff, but Murtagh said he also wants a presence in the southeast.

He said Kingspan, which is setting its stall out on the off-site construction front, hopes either to make an acquisition or to establish a greenfield operation by the end of the year or possibly early 2007.

Murtagh said the company will invest about 3m per annum in off-site operations over the next number of years. In the US, he said, Kingspan's previous bad experience with its Tate acquisition had "raised its awareness" of the market, but "does not detract us from further investment". He said that Kingspan is on the lookout for further US acquisition opportunities.

Anyone looking to make a quick buck from the stock should, however, bear in mind that it has experienced a somewhat meteoric rise in the past year. Davy Stockbrokers believes that the shares, which have risen by about 34% in 12 months, are "fairly valued" at the moment.