Vulcan achieves higher prices, except for cement

Vulcan achieves higher prices, except for cement
Published: 04 August 2011

Vulcan Materials’ first half turnover declined by 3.3% to US$1,189.2m and the EBITDA was down by 6.2% to US$146.4m.  After a net interest charge 30.1% higher at US$113.2m, the pre-tax loss for the period rose by 22.1% to US$149.5m.  However, a greater availability of tax losses limited the reduction in net attributable earnings to just 0.2%, to US$62.9m.  Capital investment was increased by 22.2% to US$51.5m, but the full year estimate has been reduced by 20% to US$100m and compares with the US$86m spent in 2010.  The net debt increased by 3.0% to US$2,784.3m, giving a gearing level of 71.7%. 

Turnover from aggregates declined by 5.3% to US$810.0m, with the volume being down by 6.5% to 59.78Mt. The average price improved by 1.5% to US$11.41/t.  While volumes were negatively affected by weather conditions in some markets, notable increases in road spending were seen in California, Virginia and Maryland.  Aggregates volumes in the second half year are expected to improve by between 2% and 6%, boosted by large projects in California, Virginia and Georgia and average prices are forecast to increase by between 1% and 3%.   

Ready-mixed concrete and concrete products turnover declined by 4.0% to US$180.4m and ready-mixed concrete deliveries were down by 7.9% to 1.43Mm³ while prices recovered by 6.3% to US$120.33/m³.

Vulcan sold 0.31Mt (0.35Mst) of cement in the six months, a reduction of 17.0%, with inter-group deliveries declining by 2.7% to 0.15Mt and third party sales falling by 9.9% to 0.2Mt.  The average cement price achieved came down by 3.8% to US$85.13/t (US$877.23/st), with the turnover falling by 18.4% to US$33.4m.  The gross loss rose notably from US$0.8m a year ago to US$4.6m this time and the loss for the full year is expected to be a bit higher than last year.