Eastern Europe leads Buzzi Unicem’s growth

Eastern Europe leads Buzzi Unicem’s growth
Published: 13 September 2007

Buzzi Unicem increased first half cement deliveries by 7.4% to 16.7Mt, with shipments being ahead in all countries with the exception of the United States. In ready-mixed concrete, volumes were 6.3% higher at 8.3m m³, with all countries other than the USA and Italy increasing deliveries.  Group turnover advanced by 10.3% to  EUR1.675.8m, but at constant exchange rates the increase would have been 13.6% as the weaker US and Mexican currencies depressed the numbers. The EBITDA was 2.2% higher at EUR429.5m, but before exchange rate movements the increase stood at 6.2%, and the trading profit (EBIT) improved by 2.7% to EUR330.5m.  A 33.4% drop in interest costs to EUR29.7m and turnaround in the contribution from associates led to a 14.8% advance in the pre-tax profit. Net debt at the end of June stood at EUR777.2m to give a gearing level of 33.5%, while capital expenditure in the period amounted to EUR330.0m.
 
The Italian turnover declined by 2.1% to EUR493.4m, while the EBITDA fell by 15.4% to EUR98.4m.  The reduction in margins reflect an average decline in cement prices of 0.6% in combination with higher costs and lower ready-mixed concrete deliveries.  Cement and clinker volumes, however, did increase by 3.6%.  In ready-mixed concrete, weaker underlying demand, in particular from the public sector, combined with wet weather in May and June, led to an 8.3% reduction in shipments.    
 
Eastern European cement shipments rose by 25.1% and the turnover increased by 53.2% to EUR311.1m and the EBITDA advanced by 63.3% to EUR101.6m.  Ready-mixed concrete in the three countries where the group is active in this activity rose by 24.4%, with the highest advance being seen in the Ukraine, where the product is still in its infancy, with a jump of around 64%.  In Poland, cement deliveries rose by 39.1% and prices by 17.0%, while in the Ukraine volumes were ahead by 34.4% and prices by 61.2%.  The Czech and Slovak cement prices were only some 3% higher, but volumes rose by 30.9%.  In Russia, on the other hand, where capacity limitations limited the volume increase to 7.0%, cement prices shot up by 43.6%.