With its own shareholding in Ambuja Cement Eastern (ACEL) well past the controlling 50 per cent mark, Swiss cement maker Holcim has for the first time consolidated the financials of its Indian subsidiary with itself.
Following the consolidation of the 2Mt ACEL and UK-based building materials Aggregate Industries, which became a wholly-owned subsidiary of Holcim earlier this year, the EBITDA margin of the Swiss major has declined marginally to 25.9 per cent during the first half of the year, as against 27.2 per cent in the corresponding period in the previous year.
"Factoring out Aggregate Industries and Ambuja Cement Eastern, the EBITDA margin improved to 27.4 from 27.2 per cent for the prior-year period. When changes to the scope of consolidation are taken into account, the EBITDA margin is, as might be expected, lower - at 25.9 per cent," Holcim has said in a statement.
ACEL is currently 95 per cent owned by special purpose vehicle (SPV) Ambuja Cement India, a joint venture between Holcim and Gujarat Ambuja Cements, India’s fourth largest cement maker.
Given Holcim’s 67 per cent holding in ACEL, the independent shareholding of the Swiss major in ACEL works out to 63.7 per cent, making it a subsidiary of Holcim. ACEL was earlier a subsidiary of Gujarat Ambuja Cements.
Holcim’s shareholding in India’s second largest cement maker ACC, which has a cement capacity of 18Mt, is however much lower than the required majority, and has hence not been consolidated. ACEL, which is now a promoter of ACC, owns 34.7 per cent in the company, and Holcim’s independent shareholding in ACC works out to just over 23 per cent.
"The integration into the group of the major acquisitions made at the beginning of the year proceeded on schedule. The Holcim Group has expanded considerably with the acquisition of 100% of Aggregate Industries and the first-time consolidation of Indian Group company ACEL," Holcim has said.
Holcim, one of the world’s leading suppliers of cement, aggregates, concrete and construction-related services, reported a 24.6% growth in sales during the first half. It said the growth was strongest in North America (+47.8 per cent), followed by Africa Middle East (+33.5 per cent), Europe (+20.2 per cent) and Asia Pacific (+9.9 per cent).
With two new subsidiaries-in India and the UK-in its fold, Holcim’s employee strength has increased from 46,909 to 61,006 during the first half.
"Growth rates were particularly impressive in India where Holcim, in partnership with Gujarat Ambuja, gained a foothold during the period under review as the promoter and single largest shareholder of the country’s second-largest cement group, ACC," the Swiss major has said.