The first quarter turnover, consolidating Dyckerhoff for the first time, shows a 2.6% pro-forma decline to €544.9m, though when measured in local currencies there was an advance of 2.9%. Margins improved markedly as the operating profit at the EBITDA level rose by 8.1% to €95.5m, which represents an increase in local currency terms of 15.0%, and the trading profit shot up from €24.1m to €39.4m, a jump of almost 45%. The gearing level at the end of March stood at 71%. Cement deliveries during the period were up by an underlying 2.9% to 6.1m tonnes and the ready-mixed concrete volume advanced by 2.5% to 3.2m m_.
Buzzi Unicem’s cement deliveries in Italy rose by 4.4% over the comparative period last year, but average prices slightly lower. Ready-mixed concrete volumes were some 4% lower than the first quarter of last year because of lower supplies to the Turin to Milan high speed railway line. Turnover in Italy declined by 1.7% to €222.9m and margins narrowed from 24.5% to 24.0% to give an EBITDA 3.6% lower at €53.6m. The volume outlook for the rest of the year is positive, but prices need to rise to reflect the increased energy costs in order to maintain profitability.
Elsewhere in Europe, virgin contributions from Dyckerhoff produced an EBITDA of €1.5m from Germany, €1.8m from Luxembourg and €2.7m from eastern Europe. In spite of the negative of exchange effect, the turnover in eastern Europe was up by 17.9% to €39.4m, principally reflecting a less harsh winter this year that allowed cement and ready-mixed concrete deliveries to increase by more than 15%. While a slight improvement in German volumes may be possible for the full year, profits should benefit from the rebound in prices, while the volume outlook in eastern Europe is considerably more positive even if the percentage increase of the first quarter is unlikely to be repeated across the region.
North American turnover rose by 7.5% to US$166.7m on cement deliveries that were some 6% higher and the EBITDA rose by 9.3% to US$26.3m. On conversion into euros, however, turnover and EBITDA fell by 7.7% and 6.2% respectively. Given the favourable trend in prices, the North American profit contribution should be at least maintained in the full year, even if an increase in interest rates reduced building activity.
The 50%-owned Corporación Moctezuma increased cement deliveries by 5.9% and the ready-mixed concrete volume by 18.2% on broadly unchanged prices in local currency terms to give increased in turnover and EBITDA of 13.1% and 5.9% respectively. However, an 18% fall in the value of the Mexican currency led to a 4.4% decline in turnover to €30.6m while the EBITDA fell by 10.5% to €14.3m. Mexican cement consumption should increase in 2004 and the group should benefit from the coming on stream shortly of the Cerritos cement works.