Italcementi

Italcementi's turnover for the first nine months edged ahead by an underlying 0.8% to €3600.2m, but the running EBITDA came down by 15.2% to €564m. The trading profit fell by 25.3% to €236.2m and the net interest charge came down by 38.6% to €56.7m, limiting the reduction in the pre-tax profit to 13.8% at €198.6m. The net profit was boosted by a €107.4m gain from the sale of discontinued activities and rose by 59.5% to €212.8m, with the net attributable profit rising almost seven-fold to €123.2m, compared with just €18.5m a year earlier. The net debt at the end of September was 0.5% lower than a year earlier at €2218.6m to give a gearing of 44.8% compared with 48.2% a year ago. Capital expenditure in the period was reduced by 27.3% to €266.3m.

Cement and clinker deliveries were 1.6% lower at 38.9Mt, with the reduction largely caused by a 33.2% drop in the volume of cement trading to 2Mt. Aggregates shipments improved by 1.3% to 29.1Mt and ready-mixed concrete deliveries were an underlying 0.2% ahead at 11.0Mm³, but the actual number jumped by 51.8% as a result of the re-consolidation of Calcestruzzi.

Cement and clinker sales in western Europe eased by 1.6% to 14.48Mt, while aggregates shipments declined by 7.5% at the underlying level, but actually increased by 1.8% to 26.49Mt thanks to the inclusion of Calcestruzzi and that consolidation led to a jump of 88.7% in ready-mixed concrete deliveries to 8.13Mm³, though the underlying advance was a more modest 1.3%. Italian cement volumes were down by 4.9% to 6.8Mt, but prices have begun to recover. The 31.7% increase in turnover €698.7m largely reflects the re-consolidation of Calcestruzzi, which also led to a more than doubling of the underlying EBITDA loss to €7.4m. In France and Belgium, turnover recovered by 5.3% to €1218.1m but the EBITDA came down by 9.6% to €231.5m. French cement volumes improved by 5.9Mt, while in Belgium there was a 4.4% improvement, in spite of lower clinker exports, with prices being slightly lower in both countries, with downstream volumes being ahead in both countries. Group cement deliveries in Spain were down by 11.6%, but higher exports limited the overall volume decline to 4.6%, with the overall Spanish turnover being off by 10.4% to €124.4m and the EBITDA fell by 25.9% to €20.8m. Greek cement shipments fell by 32.1%, with the third-quarter drop being 43.8%. The gain from the sale of emission rights was almost unchanged at €47m, coming mainly from Italy and Bulgaria.

The Arab countries and Black Sea regional turnover fell by 18.2% to €783.5m and the EBITDA declined by 18% to €253.1m. Cement shipments declined by 6.1% to 12.08Mt, with aggregates sales dropping by 20.5% to 1.36Mt but ready-mixed concrete held up better and were off by just 3.0% to 1.69Mm³. In Egypt, by far the biggest market, turnover fell by 30.3% to €425.7m and the EBITDA dropped by 42.5% to €108.1m, with domestic cement volumes being down 12% as a result of weak demand and increased production capacities. Prices were hit by the unbalance between supply and demand. Including exports the volume reduction was slightly less at –11.5%. Moroccan cement and clinker shipments 8.2% in the first nine months, with domestic deliveries being ahead by 6.7% and prices improving in spite of the arrival of a new competitor. Ready-mixed concrete deliveries rose by 9.2%, but aggregates shipments fell by 20.9%. Profitability was helped by the new Ait Baha works produced a greater volume and at a lower cost, with the EBITDA advancing by 16.8% to €115.5m on a turnover up by 6.4% to €265m. In Bulgaria, cement and clinker deliveries in the year to date were down by 10.2%, but a 13.8% volume increase was seen in the third quarter and profitability was helped by the sale of emission certificates. In Kuwait, cement deliveries rose by 6.7%, though competitive pressure increased in the third quarter and ready-mixed concrete volumes rose by 21.8%.

Asian cement deliveries improved by 2.1% to 8.48Mt and turnover advanced by 16.8% to €385.4m, while the EBITDA recovered by 58% to €74.3m. Aggregates shipments improved by 14% to 0.22Mt and ready-mixed concrete deliveries were 2.9% higher at 0.56Mm³. In India, turnover jumped by 35.9% to €170.2m and the EBITDA jumped by 108.7% to €47.7m. Cement and clinker volumes rose by 5.3%, but the commissioning of additional capacities led to a 12.7% reduction in the third quarter. A new cement works with a capacity of 3Mta is being planned for North Karnataka, with completion scheduled for 2015, taking the group's Indian capacity to almost 9Mt. The Thai turnover increased by 15.1% to €151.3m and the EBITDA just over doubled to €22.7m. Total sales volume grew by 4%, with exports being curtailed because of the strength of domestic demand. The Chinese cement volume declined by 3% as additional capacity led to price pressure, with margins further affected by higher coal prices. As a result, turnover declined by 14.7% to some €32m and the EBITDA was eliminated, having been €6m in the corresponding period last year. In Kazakhstan, additional modern capacity coming on-stream led to a 12.3% reduction in the volume sold. However, prices were ahead, but not sufficient to cover for the higher energy costs with the result than the turnover eased by 10.9% to €31m and the EBITDA fell by 39% to €4m.

The North American turnover declined by 6.2% to €297.5m and the EBITDA tumbled by 82.7% to €2.4m as a result of fierce competition and higher transport costs. However, cement deliveries did improve by 4.3% to 3.15Mt and aggregates deliveries rose strongly by 32.60% to 0.98Mt, thanks to improved road-building activity in Canada. Ready-mixed concrete deliveries, however, declined by 7.3% to 0.56Mm³.

The Italcementi subsidiary Ciments Français has seen interest in its Afyon Çemento subsidiary, which it aims to dispose of, from Çimsa Cemento. Afyon Çemento currently has a cement capacity of 0.5Mta. Çimsa Cemento is effectively controlled by Sabanci, which directly owns 39.4% and controls a further 10% through Akçansa, its joint venture with Heidelberg Cement. Çimsa Cemento is one of the world's leading producers of white cement and already has four integrated cement works and one grinding centre for grey cement.