Continental Europe & emerging countries help HeidelbergCement’s advance

Continental Europe & emerging countries help HeidelbergCement’s advance
Published: 06 November 2008

HeidelbergCement’s results for the first nine months include Hanson for the full period, compared with just one month last year, as a result of which turnover grew by 49.1% to EUR10,809.2m and the EBITDA by 24.4% to EUR2,141.2m, while the trading profit increased by 15.6% to EUR1,552.0m.  The net attributable profit, boosted by the capital gain on the sale of Maxit this time and on the stake in Vicat last year, improved by 8.5% to EUR1,984.7m.

The net interest charge jumped 118.8% to EUR555.6m while the net debt at the end of September was reduced from EUR14,608m to EUR12,292m, with the gearing declining from 193.4% to 128.9%, which remains very high.  Some cement projects that have not been far developed may thus be postponed until the outlook improves.  Capital investment in the existing business rose by 20.4% to EUR697m in the period, while spending on acquisitions dropped by 99.1% to EUR102m.  Group cement and clinker shipments advanced by an underlying 0.3% to 68.5 m tonnes.  The aggregates volume jumped from 98.4Mt to 229.4Mt, but excluding Hanson, there was a 2.4% decline to 69.8m tonnes, while ready-mixed concrete deliveries were 59.0% higher at 33.7Mm³, of which 14.1Mm³ came from Hanson, suggesting an underlying increase of 2.1%. 
The group’s European turnover, which for HeidelbergCement includes much of the former Soviet Union, rose by 45.4% to EUR5,610m and the EBITDA increased by 20.9% to EUR893m. Cement, clinker and ground granulated slag volumes rose by 6.3% to 33.45m tonnes, with notable volume increases being achieved in Russia, the Czech Republic, Estonia, Sweden, Norway Belgium and The Netherlands, with production volumes also rising in Germany, helped by higher exports, but British volumes declined. Excluding acquisitions, the European cement volume was 1.8% ahead.  

In North America, the Hanson deal helped to achieve a 43.5% increase in turnover to EUR3,000m, but the drop in housebuilding activity, in particular, led to a 25.0% reduction in the EBITDA to EUR286m.  The underlying turnover was off by 12.2%.  North American cement shipments fell by an underlying 11.9% to 10.69Mt, though there was a modest increase in Canada and all the reduction came in the USA and across virtually all regions there. Imports were cut drastically in order to ensure good capacity utilisation of the cement plants. 

In Asia, Australia and Africa, turnover was boosted by the Hanson deal and turnover rose by 66.5% to EUR2,109m and the EBITDA increased by 63.3% to EUR461m.  At the underlying level, the turnover improved by 28.4%.