Egypt is Vicat’s star performer

Egypt is Vicat’s star performer
Published: 06 August 2009

Vicat’s first half turnover declined by 8.8% to €962m, which represents a 12.4% reduction on a comparative basis and the EBITDA was off by 14.7% to €230m.  The net attributable profit fell by 30.6% to €89m. Capital expenditure in the first half amounted to €154m, a reduction of 35%.  The gearing remains modest at 39.0% with net debt standing at €766m. Group cement shipments increased by 1.2% to 7.33Mt, though the turnover from cement was 1.2% lower at €579m. Cement accounted for 53% of turnover in the period and concrete and aggregates for 33%, with other products making up the remaining 14%.

In France, the turnover was off by 20.3% to €431m and the EBITDA fell by 27.9% to €103m.  Cement shipments were down by around 20%, but a continued improvement in prices limited the reduction in turnover from cement to 16.2%.  Higher energy costs were compensated for by increased economies as well as higher prices.  French aggregates and concrete turnover was down by 25.0%, with volumes falling by over 26% in aggregates and by in excess of 29% in ready-mixed concrete.  In the rest of Europe, turnover declined by 3.6% to €135m, but the EBITDA improved by 7.0% to €33m, thanks to the elimination of clinker purchases in Switzerland and better prices there, while lower Italian volumes were compensated for by more favourable clinker purchases.  The cement capacity at the Reuchenette works in Switzerland was increased to 0.9Mt from the end of June.

The US turnover was down by 23.7% to €104m , but at constant exchange rates and parameters the drop was 37.3%, and the EBITDA fell by 66.1% to €8m, with a €9m loss being incurred at the trading level.  Cement volumes fell by more than 30%, with most of the drop taking place in California.  Prices were slightly lower in the south-east and more notably so in California.  Ready-mixed concrete turnover fell by 36.9%, with margins under pressure in both regions. 

Turnover in Turkey dropped by 26.1% to €70m and the EBITDA by 62.6% to €6m.  Cement shipments declined by almost 9% because of lower exports, essentially to Russia.  Domestic cement prices remain under pressure because of the considerable over-capacity and are down by some 15%.  Volumes declined by some 10% in aggregates but were stable in ready-mixed concrete.  To date, the new cement works being built in Kazakhstan has suffered no delays and it should come on stream towards the end of next year.

African and Middle Eastern turnover rose by 55.4% to €221m and the EBITDA rose by 40.8% to €81m.  Egypt, where the underlying turnover rose by in excess of 104%, provided most of the improvement and here cement shipments jumped by almost 76% and prices rose, though margins did narrow in response to higher gas prices and the recently introduced clay tax.  A further grinding plant should be commissioned during the first half of next year.  In West Africa, the underlying turnover advanced by almost 12% in response to good volumes in Sénégal and Mali, even if aggregates shipments were down by over 22% because of plant being down for modernisation and margins suffered from the need to buy in clinker and from higher energy costs.