Dyckerhoff delays Russian and Ukrainian investments

Dyckerhoff delays Russian and Ukrainian investments
Published: 03 February 2009

The preliminary results from Buzzi Unicem’s subsidiary Dyckerhoff show a 1.4% reduction in group cement shipments to 17.32Mt, entirely because of the 10.8% drop in the United States.  Turnover, however rose by 10.7% to €1,969m, and ready-mixed concrete deliveries increased by 9.0% to 8.22Mm³.  Capital expenditure jumped by 91.2% to €346m, and around €330m is likely to be spent in 2009.

The German turnover rose by 17.6%, or by 13.1% at the underlying level, to €595m.  While cement shipments increased by 2.9%, domestic deliveries declined and all the increase came from the growth in exports.  Domestic cement prices increased by about 8%, compared with 9% in the previous year, while average prices in ready-mixed concrete improved by 10%.  A €15/t cement price has been announced for 2009, but it remains to be seen how much sticks.  Last year a  €9 list prices increase was announced from the beginning of 2008. 

In Luxembourg, underlying turnover improved by 7.2% to €89m, with cement shipments being 0.9% higher and prices rising by some 5%.  In The Netherlands, turnover was down by 7.8% to €130m on an exceptionally strong 2007, but prices rose by 4% in ready-mixed concrete and by 17% for sand and by 9% for gravel.  
Polish turnover advanced by 28.7% to €184m, with prices rising by 13% in cement and by 10% in ready-mixed concrete, with cement deliveries advancing by 9.8% and some market share being recovered.  Czech cement shipments rose by 2.1%, while the turnover from the Czech and Slovak operations rose by 20.8% to €261m.  Cement prices improved by 4% higher and ready-mixed concrete prices were 2% up, while prices rose by 5% for sand and by 9% for gravel.

The fourth quarter was particularly badly affected in both the Ukraine and Russia.  In the Ukraine, cement shipments declined by 2.2% but higher energy costs meant that the turnover rose by 16.8% to €209m.  Cement prices were 34% ahead on higher gas prices and ready-mixed concrete prices rose by 23%, but volumes declined.  The timing of the new kiln for the Volyn works has been postponed until further notice, but preparatory work continues.  The Russian turnover increased by 34.8% to €267m as average prices were up again, though volumes declined by 3.0%.  The additional capacity at the Suchoi Log works should come on stream in the final quarter of this year.   The new cement works being built at Akbulak near Orenburg is being delayed because of the weakness in Russian demand and is now expected to go into production in 2014, rather 2010/11.

The US associate saw a 10.8% reduction in cement deliveries and the turnover fell by 16.3% to €256m on conversion.  In local currency, cement prices fell by almost 2%.  The Oglesby works has been mothballed, but the increased capacity at the Selma works should come on stream around the end of this year.