Lafarge's first quarter turnover shrank by 9.7% to €3,276m and the EBITDA was down by 16.9% to €516m, with the running profit falling by 29.6% to €236m. Net interest costs were 21.2% lower at €178m and there was an exceptional credit of €137m on the sale of the Cimpor stake to Votorantim. Excluding the Cimpor deal, there was a €22m pre-tax loss, compared with a €54m profit last year and the net attributable loss widened from €17m to €73m, but including the Cimpor sale, a €64m profit was reported. Net debt at the end of March was 17.5% lower at €14,582m to give a gearing level of 81.4%, down from 118.7% a year earlier. Capital expenditure was reduced by 9.4% to €384m as maintenance capital spending was further cut from €165m two years ago to just €45m. Capital expenditure for the full year should amount to around €1,300m. Cement shipments in the period declined by 7.4% to 29.0Mt, the aggregates tonnage was down by 9.4% to 32.6Mt and ready-mixed concrete volume fell by 17.1% to 7.3m m³, but the global gypsum volumes did improve by 3.7% to 168m m², thanks to higher Asian volumes, even if turnover and profit were lower.
European cement turnover declined by 17.9% to €495m, with the EBITDA falling by 45.2% to €68m as the Eastern European operations went into a loss. Cement shipments fell by 16.4% to 5.6Mt. French cement volumes fell by 13.2% and average prices eased by 0.5%. British cement shipments actually recovered by 1.8% though prices eased somewhat. Spanish volumes fell by 14.8% and prices and mix accounted for a further 13.8% reduction in sales. Greek volumes dropped by 19.5% on top of a 29.6% fall in the previous year, though prices were stable. German volumes fell by 11.6% on prices that were marginally ahead. In Poland, cement volumes fell by 21.1%, with normal deliveries only resuming in mid April, because of the hard winter. Romanian volumes suffered worse and deliveries dropped by 42.3%. The Serbian volume decline was a comparatively modest 6.1% and here prices improved. Russian volumes fell by 39.9%, with prices declining by high single digits. Downstream, French volumes fell by 10.2% in aggregates and by 12.5% in ready-mixed concrete, while the British volumes improved by 9.0% and 1.9%, respectively.
North American cement turnover declined by 12.3% to €185m and a slightly reduced loss of €25m was incurred at the EBITDA level. Cement shipments fell by 16.8% in the United States, but improved by 3.7% in Canada, and the North American volume was 0.2Mt lower at 1.9Mt. The North American aggregates volume declined by 1.7% to 12.5Mt and the turnover was €1m higher at €111m while in ready-mixed concrete, volumes were 0.2m m³ lower at 1.1m m³ and the turnover declined by 9.4% to €125m. Cement turnover in Latin America declined by 12.8% to €136m and the EBITDA was about 7% to €41m. Cement deliveries were some 5% lower at 1.8Mt. In Brazil, volumes improved by 10.2%, but changes in prices and mix trimmed the sales increase to 6.3%. In Ecuador, volumes declined by 13.7%, but prices did improve to some extent.
In Africa and the Middle and Near East, turnover eased by 7.9% to €850m and the EBITDA declined by 12.4% to €2824m. Cement shipments declined by 9.2% to 9.9Mt. The arrival of new competitors in Jordan and in Kenya saw cement volumes in those countries decline by 44.9% and 26.6% respectively, though in Jordan prices still improved. In Nigeria, volumes declined by 11.1%, but prices showed an improvement. Heavy rain caused Moroccan cement shipments to decline by 6.0%, but elsewhere in the region volumes were ahead. Egypt remains a strong market, with volumes and prices both modestly ahead. Volumes rose by 17.5% in Iraq, though prices were weaker. In South Africa, cement volumes rose by 9.9%, though downstream volumes fared less well with reductions of 21.7% in aggregates and of 20.5% in ready-mixed concrete.
Asian cement shipments declined by 1.6%, though by destination volumes improved by a similar percentage to 9.8Mt. Turnover improved by 6.6% to €471m and the EBITDA advanced by 9.2% to €119m. The areas in China where Lafarge is strong suffered from a drought in the period and cement shipments declined by 1.3%, but for the full year a volume growth in the region of 10% to 15% is still being expected, helped by the commissioning of additional capacity this year. Good demand was reported in the Philippines, with cement deliveries advancing by 12.1%. Cement shipments in India were ahead by 5.4% though prices were up by more than a quarter, essentially on the back of higher taxes and input costs. Volumes in the important Malaysian market were stable, but in South Korea, another important market, volumes dropped by 24.4% in a weak market. The North Korean subsidiary has yet to be consolidated.
In late May, Lafarge has concluded a deal with the Austrian construction group Strabag, whereby the two groups will form Lafarge Cement CE Holding GmbH, 70% owed by Lafarge and 30% by Strabag. This will enable Lafarge to increase its sphere of influence while at the same time limiting its capital commitment. Lafarge Cement CE Holding will take over Lafarge's cement works at Mannersdorf and Retznei in Austria, at Trbovje in Slovenia and at Cizkovice in the Czech Republic as well as the works currently under construction by Strabag at Kiralyeghahza near Pecs in Hungary that is to come on stream around the turn of the year. Strabag will be looking to Lafarge to supply its cement requirements in Austria, the Czech Republic, Slovakia, Slovenia and Hungary, which should amount to some 1.5Mt annually.