Buzzi Unicem - August 2014

Buzzi Unicem's first-half turnover improved by 2.7 per cent to EUR1180.7m and EBITDA rose by 27.7 per cent to EUR138.5m. The depreciation and impairment charges include EUR30.9m in respect of writing off the goodwill in the Ukraine. The first-half trading profit recovered from EUR3.1m to EUR14.1m and the interest charge declined by 1.2 per cent to EUR47m and the pretax loss was reduced from EUR26m to EUR11.1m.  After a tax charge 9.1 per cent higher at EUR9.7m and a minorities charge 25.3 per cent lower at EUR1.8m, the net attributable loss declined by 35.2 per cent to EUR22.6m. Net debt at the end of June was 2.8 per cent higher at EUR1127.5m, giving a gearing level of 51.8 per cent, compared with a restated 48.5 per cent a year earlier. Capital expenditure in the period amounted to EUR82.3m. For the full year Buzzi Unicem is forecasting an underlying EBITDA slightly in excess of EUR400m.

Group cement deliveries, which now exclude joint ventures, improved by 5.6 per cent to 11.7Mt. The group ready-mixed concrete deliveries improved by 8.5 per cent to 5.9Mm³.

Italian cement and clinker volumes were little changed at -0.1 per cent, with lower domestic cement deliveries being offset by higher sales of clinker. The average sales price was 6.9 per cent lower, mainly reflecting a different product mix and the underlying price was little changed. Ready-mixed concrete deliveries showed a 9.3 per cent volume recovery, but prices declined by 7.8 per cent.

Buzzi Unicem's Italian turnover declined by 3.7 per cent to EUR193.6m and the loss at EBITDA level was reduced from EUR17.8m to EUR8.4m, ignoring exceptional items.

In Germany, turnover improved by 11.4 per cent to EUR296.4m and EBITDA improved by 16.7 per cent to EUR23.5m, but net of non-recurring items the increase was 28.2 per cent. Cement shipments rose by 11.6 per cent to 2.49Mt while prices were off by 0.6 per cent. Ready-mixed concrete deliveries improved by 11.1 per cent to 1.92Mm³, with prices improving by two per cent. Luxembourg cement and clinker volumes improved by 6.8 per cent to 0.6Mt and the average price was 0.8 per cent higher. The turnover was up by 7.4 per cent to EUR55.4m and EBITDA advanced by EUR1.2m to EUR7.8m.  The Dutch turnover fell by a further 20.2 per cent to EUR28.8m and EBITDA loss was reduced from EUR4m to EUR0.6m while volumes in ready-mixed concrete fell by some 15 per cent to 0.29Mm³.

The Polish turnover declined by 4.1 per cent to EUR43.6m and EBITDA decreased by 7.3 per cent to EUR8.4m. Cement volumes declined by 12.3 per cent to 0.53Mt as a new price list in April was badly received by clients and was revised in June. Prices in the six months were up by 3.6 per cent, while ready-mixed concrete deliveries rose by 20.3 per cent to 0.34Mm³, but prices eased by 4.3 per cent. The Czech and Slovak turnover improved by 14.2 per cent to EUR61.4m and EBITDA rose by from EUR3.7m to EUR9.1m. Cement volumes rose by 24.9 per cent to 0.39Mt, but the average price eased by two per cent, while ready-mixed concrete volumes rose by 22.4 per cent to 0.72Mm³.  

The Ukrainian turnover suffered from the drop in the value of the currency and declined by 17.7 per cent to EUR43.3m, but EBITDA recovered from EUR1.3m to EUR5.4m. Cement volumes increased by 6.6 per cent to almost 0.75Mt and local prices edged ahead by 1.5 per cent, with concrete volumes jumping by 28.9 per cent though prices eased by 1.9 per cent.  In Russia, turnover declined by 9.3 per cent to EUR102.6m and EBITDA came off by 1.7 per cent to EUR35.4m after a 17.5 per cent drop in the value of the rouble. Cement shipments increased by 5.7 per cent to 1.39Mt while prices increased by two per cent in local currency.

In the United States, turnover improved by 11.5 per cent to US$505.6m, which on translation converts into a 6.9 per cent increase to EUR368.9m. At EBITDA level, there was a 15.6 per cent increase to US$81.0m, which on conversion turns into a 10.8 per cent advance to EUR59.3m. In spite of a negative weather effect in parts, there was an overall volume increase of six per cent in cement and of 0.7 per cent in ready-mixed concrete. Average selling prices in local currency increased by 6.2 per cent for cement and by 11.5 per cent for ready-mixed concrete.    

The 50 per cent-controlled Mexican associate Corporación Moctezuma is now accounted for by the equity method. Cement volumes have been improving but were still below the level of the previous year's first half and ready-mixed concrete deliveries were lower as a number of batching plants were closed. In spite of the lower value of the Mexican peso, Corporación Moctezuma's turnover improved by 1.7 per cent to EUR243.5m and EBITDA rose by 9.2 per cent to EUR91.9m.