Taiheiyo Cement improves first half trading performance

Taiheiyo Cement improves first half trading performance
Published: 02 December 2005

Some recovery in domestic cement deliveries, higher lime exports and the growing waste processing operations have enabled Taiheiyo Cement Corporation to increase turnover for the six months to the end of September by 3.5 per cent to Y427,652m (€3041m). The EBITDA emerged 18.8 per cent higher at Y43,311m (€308m) and thanks to a 5.1 per cent reduction in depreciation and amortisation charges, the trading profit improved 47.0 per cent to Y24,578m (€175m) and the profit before tax and exceptional items was 56.4 per cent higher at Y17,581m (€125m). However, exceptional items pushed the leading Japanese cement group into a net loss Y12,777m (€91m), caused primarily by an impairment charge of Y31,789m (€226m) and net losses in sale of fixed assets of Y3997m (€28m).
 
The cement operations accounted for 60.3 per cent of group turnover, or Y257,967m (€1834m), ahead of mineral resources with 12.1 per cent, other construction materials with 9.8 per cent and environmental activities with 7.7 per cent.  The trading profit from cement was 43.6 per cent higher at Y17,764m (€126m). Operations outside Japan generated 21.8 per cent of the group turnover, or Y93,199m (€663m), of which North America represented Y43,343m (€308m) and overseas Asian markets Y40,317m (€385m). The quality management and technical services functions of the cement company are being merged into a technical support unit, while the Oita cement works will also take over the management of the Tsukumi and Saiki plants, reducing overheads and improving staff flexibility.
 
On the back of the better than expected first half results, the Taiheiyo Cement Corporation management has increased its full year forecasts for turnover and profit before exceptional items by 1.1 per cent to Y880,000m (€6,260m) and 14.5 per cent to Y47,000m (€334m) respectively.  It is also expecting a modest profit of some Y5000m (€36m) at the net level, rather than a loss, helped in addition by a lowering of the envisaged tax charge.