Buzzi Unicem widens margins

Buzzi Unicem widens margins
Published: 15 November 2005

Buzzi Unicem’s cement volume grew by 1.1 per cent to 24.6Mt in the first nine months of the year, while ready-mixed concrete deliveries rose by 2.1 per cent to 11.7m m³.  Of those volumes, Dyckerhoff contributed 1.7 per cent more cement at 12.4Mt and 6.9 per cent more ready-mixed concrete at 4.1m m³. Group turnover for the period emerged 4.7 per cent higher at €2195.9m, while the EBITDA improved by 9.9 per cent to €589.2m. Although net interest payments dropped by 28.5 per cent to €64.9m, foreign exchange losses under IFRS led to a 1.6 per cent increase in overall financial charges to €102.5m, with the pre-tax profit going up by 14.6 per cent to €324.2m.  Net debt at the end of September was 11.9 per cent lower at €1231.4m, while shareholders’ funds 21.3 per cent to €2006.8m, resulting in a drop in the gearing level from 84.5 per cent to 61.4 per cent.  Capital investment in the year to date amounted to €139.0m, of which €27.9m was spent on increasing capacity.
 
In Italy, turnover was down by 1.8 per cent to €712.0m and the EBITDA fell by 5.7 per cent to €193.3m, predominantly reflecting margin pressure in cement as prices declined until the late spring and increased energy costs were thus not recovered other than partially during the summer.  The sale of the minority stake in the power joint venture with E.ON gave rise to an exceptional profit of €37.1m.  The group’s Italian cement deliveries were broadly stable in the year to date, but ready-mixed concrete deliveries down by 3.5 per cent because of lower shipments to big public sector civil engineering works.
 
German turnover was off by 1.3 per cent to €363.0m, while restructuring costs of €7.7m contributed to a 23.3 per cent reduction in the EBITDA to €35.9m.  Because of the continued decline in German construction activity, Dyckerhoff’s domestic cement deliveries declined by 5.2 per cent in the period, a rate of decline that is likely to accelerate in the final quarter. The benefit from the price increase early in the year was eliminated by the extent of the fall in demand. Ready-mixed concrete volume was off by 3.2 per cent.  In an effort to sell increased portions of blended cements, that carry a lower effective CO2 levy, Dyckerhoff has announced price increases from next January of €4.50 per tonne for CEM II and CEM III, compared with an €8.00 increase for CEM I.  Ciments Luxembourgeois’ cement and clinker shipments were up by 13.6 per cent, helped by additional clinker exports to France, but concrete products volumes were lower.  The Luxembourg turnover was little changed at €108.7m but higher production costs left the EBITDA 22.6 per cent lower at €18.5m.