Eastern Europe boosts Buzzi Unicem profits

Eastern Europe boosts Buzzi Unicem profits
Published: 31 March 2008

In 2007, Buzzi Unicem increased turnover by 9.1% to EUR3,205m and the EBITDA advanced by 12.3% to EUR1,043.6m.  The trading profit improved by 14.7% to EUR834.7m and, helped by a near halving of the net interest charge to EUR22.2m, the pre-tax profit rose by 25.2% to EUR824.8m. The net attributable profit recorded a 31.1% advance to EUR458.5m.  Capital investment amounted to EUR322.4m, in addition to which acquisitions absorbed EUR204.9m. Net debt at the end of December was stood 2.0% higher at EUR621.2m to give a gearing level of 24.7%, compared with 25.1% a year earlier.

Buzzi Unicem’s cement shipments increased by 2.2% higher to 34.1Mt, with production volumes ahead in all countries other than Italy and the United States, while ready-mixed concrete deliveries rose by 3.4% to 17.1Mm³.  
 
In Italy, the turnover was down by 4.2% to
EUR961.5m and the EBITDA fell by 12.2% to EUR207.1m. Cement deliveries from the Italian plants declined by 1.4% to 8.5Mt, but selling prices moved up in line with inflation. In ready-mixed concrete, margins declined as volumes dropped by 10.9% to 6.8Mm³ in response to lower civil engineering and housebuilding activity. Volumes are expected to continue to fall in 2008, higher prices should maintain profitability roughly at last year’s level.
 
German turnover improved by 7.3% to
EUR514.9m and the underlying EBITDA rose by 25.9% to EUR80.3m thanks to a 7.7% increase in average cement prices, better pricing in ready-mixed concrete and an increased use of alternative kiln fuels.  Helped by higher exports, essentially to The Netherlands and to Poland, cement shipments improved by 4.1% to 5.35Mt.
 
Poland produced a 29.3% increase in turnover to €142.8m and the EBITDA rose by 55.5% to
EUR52.1m, in spite of the absence of gains on the sale of emission rights that had contributed EUR4.8m in the previous year.  Cement sales were boosted by inter-group supplies from Germany ands the Czech Republic.  The Czech and Slovak businesses contributed a turnover 18.4% higher at EUR182.4m and the EBITDA rose by 13.8% to €70.3m as ready-mixed concrete deliveries increased by 10.8% to 2.30Mm³ and Czech cement shipments advanced by 20.1% to 1.04m tonnes thanks to exports to Poland.  Boosted by higher energy costs, Ukrainian turnover rose by 67.2% to €179.2m and the EBITDA jumped from EUR15.3m to €58.1m as cement deliveries rose by 12.4% to 2.55m tonnes and ready-mixed concrete deliveries 37.2% to 0.38m m³.   In Russia, higher cement prices led to a 59.8% increase in turnover to EUR197.9m and the EBITDA jumped by 78.1% to EUR94.7m on a volume that was just 0.9% higher.