On the back of a 17.1% increase in turnover to EUR5,854.1m, Italcementi pushed up the EBITDA by 26.2% to EUR1,434.5m and the trading profit rose by 32.2% to EUR1012.3m. Higher financing costs reduced the increase in pre-tax profit to 24.8% to EUR918.3m and a higher tax rate left the net profit 20.5% higher at EUR651.4m.
Capital investment was 8.5% higher at EUR504.0m, while a further EUR269.2m were spent on acquisitions. The acquisitions consisted mainly of buying out the joint venture partner in Zuari Cement in India for EUR113m and taking a stake of around 29% in the Turkish cement producer Göltas Çimento for €96m. Net debt at the end of the year stood at EUR2210.3m to give a gearing level of 47.4%, compared with 50.8% a year earlier. Shipments of cement and clinker rose by 13.6% to 64.0Mt in 2006.
European cement and clinker volumes improved by 4.2% to 26.7Mt, out of which the Italian operations accounted for 14Mt. The Italian turnover rose by 9.2% to €1,619.3m, with the EBITDA improving by 17.9% to EUR230.7m. Helped by record Italian cement consumption, prices improved and higher operating costs could be passed on.
The rest of the European Union generated a turnover 12.1% higher at EUR2,043.9m, while the EBITDA improved by 11.5% to EUR501.5m at the running level. Underlying cement shipments were 5.3% higher at 12.7Mt, while ready-mixed concrete deliveries rose by 4.6% to 8.1m m³ and aggregates volumes by 7.6% to 47.9Mt. Thanks to strong demand, the French results improved in both cement and ready-mixed concrete. France is the second largest contributor in terms of turnover at EUR1.488.4m, an increase of 11.9%, but the prime contributor in terms of profit, with a 12.2% rise to EUR340.4m. Belgian cement volumes improved, but margins remained under pressure in ready-mixed concrete. Spanish cement volumes improved, as did margins in ready-mixed concrete, with turnover 14.5% higher at EUR341.1m. The Greek business had the benefit of strong domestic demand, leading to turnover rising by 20.0% and EBITDA by 23.1%.
The Mediterranean rim area had the benefit of a full year’s contribution from Suez Cement and Helwan Cement in Egypt, and strong growth in Bulgaria and in Turkey. Turnover grew by 37.2% to €1,105.5m, which represents an underlying increase 17.5%, and the EBITDA advanced by 40.5% to €428.2m. Cement shipments emerged 31.7% higher at 20.1Mt, which represents a 1.7% improvement on a like for like basis.
The strong increase in Bulgarian cement demand let to a reduction in exports, giving a further boost to margins and turnover rising by 23.7% to EUR124.2m. Egypt is third most important country in terms of profit, after France and Italy, contributed an EBITDA of EUR222.2m last year on a turnover of EUR491.3m. Morocco boosted EBITDA by 8.1% to EUR104.4m on a turnover of €244.5m, while the Turkish contribution rose by 10.6% to EUR55.4m on a turnover of 245.5m.