Egypt is now Italcementi’s largest profit earner

Egypt is now Italcementi’s largest profit earner
Published: 11 May 2009

Italcementi’s first quarter turnover declined by 11.1% to €1201.2m, while the running EBITDA fell by 27.0% to €188.9m and the trading profit by 57.3% to €64.6m.  The pre-tax profit dropped by 68.4% to €36.9m while the net attributable profit went from a €38.7m profit to a loss of €12.7m after charging €32.8m to minorities. The net debt at the end of March stood at €2689.5m, which represented a gearing level of 57.8%.  Cement and clinker shipments were down by 12.8% to 12.9Mt, while in the downstream operations, which still exclude Calcestruzzi, deliveries of aggregates fell by 23.9% to 9.1Mt and ready-mixed concrete volumes by 23.4% to 2.5Mm³.  

In western Europe, cement and clinker volumes fell by 21.9% to 4.57Mt, while aggregates volumes dropped by 24.9% to 8.3Mt and ready-mixed concrete deliveries by 26.8% to 1.4Mm³. The Italian cement volumes fell by almost 20% to 2.1Mt, with prices being almost 3% lower than a year ago, though they actually improved by some 6% in the quarter.  Turnover in Italy fell by 26.5% to €214m and a €1m loss was incurred at the EBITDA level, while in France, the main contributor in Europe, turnover fell by 18.0% to €328m and the EBITDA by 30.8% to €48m. Turnover fell in each of the other three countries, with the EBITDA dropping by 61.9% in Spain, where cement volumes shrunk by some 45%, with prices stable in the north but weaker in the south, and by 53.3% in Greece, but improving by 34.1% in Belgium.  

Bulgaria, Egypt, Morocco and Turkey saw turnover increase by 15.1% to €348m, in spite of reductions of 49.0% in Turkey and 19.3% in Bulgaria that led to a 1.9% volume decline to 4.8Mt.  Egypt overtook France to become the largest source of profits as the EBITDA improved by 8.8% to €74m and higher costs led to a 41.1% increase in the turnover to €218m.  Morocco put in a strong performance, with turnover rising by 15.0% to €80m and the EBITDA advancing by 24.2% to €30m. The Bulgarian EBITDA fell by 29.6% to €8m, while the loss incurred in Turkey was in line with the €2m lost in the previous first quarter, though volumes were much lower in both cement and concrete and cement prices fell by around 9%. 

The Asian turnover edged ahead by 1.3% to €27 and the EBITDA advanced by the same percentage to €27m.  Cement shipments were 5.0% lower at 2.58Mt.  India is now the main contributor in Asia and the turnover there improved by 8.1% to €49m while the EBITDA advanced by 33.7% to €20m. The Thai market continues to be very difficult with turnover falling by 24.0% and the EBITDA by 44.8%.  In China volumes increased and a small profit was achieved, while in Kazakhstan prices have weakened and a loss in line with the previous year, when the plant was closed, was incurred.