Cementir SpA said the synergies from its recent acquisition of Danish firms Aalborg Portland and Unicon from FLS Industries AS will be offset over the next two years by higher energy and logistics costs. In a statement at a presentation to investors on the acquisitions, Cementir said its net debt will fall to zero by the end of 2009, presuming operating results continue along present lines. ’On the basis of the present economic scenario, the company sees net debt of around 370 mln eur by the end of 2004, about two times EBITDA,’ it said in a subsequent statement.
Synergies from the Danish acquisitions are expected to boost free cash flow by about 10-12 mln eur per year, and EBITDA by 9-10 mln per year, by the end of 2006, it said. ’After the acquisition of Aalborg and Unicon, synergies on costs and sales will be counter-balanced presumably by the increase in energy and logistics costs for the next two years,’ it said. Energy costs have risen for most cement producers because of the higher oil price, and this rise has also led to higher transport and logistics costs. Cementir also said it expects capital investment at 45-50 mln eur per year in the medium term.