Cimpor

Cimpor's first half turnover advanced by 6.3% to €1,087.8m, on the back of increases in excess of 40% in Brazil and in Turkey, while declines were experienced above all in China and Spain. The EBITDA came out just 0.2% higher at €298.7m as the average margin declined from 29.1% to 27.5%, as strong advances in Turkey, Brazil and Tunisia were offset by reduced profitability in Portugal, Spain, Egypt and India and a loss in China. After a 12.6% increase in depreciation and impairment charges, the trading profit (EBIT) declined by 6.1% to €183.5m. A 42.2% reduction in financial charges still enabled a 5.4% improvement in the pre-tax profit to €156.1m. However, a higher tax charge left the net attributable profit 7.9% down at €98.7m. The net debt at the end of June was 9.7% lower at €1.719.2m, leading to a substantially lower gearing of 79.5%, compared with 109.0% a year earlier. Capital expenditure in the period fell by 48.3% to €73.4m, of which €26.2m was incurred in Brazil.

Consolidated cement deliveries improved by 3.2% to 13.93m tonnes, with higher production levels in Brazil, Portugal and Turkey offset by reduced production in South Africa and Asia. Turnover from international trading and shipping just over doubled to €57.9m and the profit contribution rose by 33.4% to €4.0m. Group aggregates sales fell by 16.4% to 5.7m tonnes and ready-mixed concrete deliveries declined by 11.3% to 3.2m m³, which reflects the importance of the Iberian peninsula in these activities.  

Portuguese cement consumption declined by some 8% during the first half, but Cimpor's cement and clinker volumes actually increased by 21.7% to 2.45m tonnes, largely helped by clinker exports to Egypt and cement exports to Cape Verde. The lower value of clinker exports meant that the turnover still eased by 0.2% to €223.8m and the EBITDA declined by 10.9% to €67.6m. The reduction in Spanish turnover was more marked at 12.9% to €140.7m. The EBITDA fell by 30.5% to €15.3m and cement shipments declined by 3.9% to €1.48m tonnes. Thanks to a less depressed market in north-western Spain, some clinker exports from there and a reduced cost base, the Spanish EBITDA actually improved by 4.5% in the second quarter.

Brazil is now not only the largest cement producer in the group, but also the largest source of turnover and profit. Cement volumes rose by 19.7% to 2.52m tonnes, and the capacity is being pushed ahead at several works. The Brazilian turnover advanced by 46.5% to €274.4m, further aided by the strength of the Brazilian currency and the EBITDA jumped by 70.7% to €89.3m. Without the exchange rate boost, the advance in EBITDA would have been some 39%.  

Egyptian cement shipments were 1.9% higher at 2.07m tonnes. Turnover rose by 5.7% to €128.3m, but higher operating costs led to a 14.3% reduction in the EBITDA to €46.6m. The margins, which had been the second highest in the group at 44.7% came down to 36.3% as a result of power shortages and having to buy in clinker. Morocco, on the other hand, increased its margins and now has the highest in the group at 43.4%. Moroccan cement deliveries edged ahead by 0.4% to 0.61m tonnes, with the turnover improving by 1.7% to €49.8m and the EBITDA rose by 5.7% to €21.6m. Tunisian cement volumes rose by 11.0% to 0.95m tonnes, with the turnover rising by 12.0% to 41.5m and the EBITDA advanced by 38.8% to €12.2m. In Turkey, the market recovered, both in terms of volumes and prices. Cement and clinker sales rose by 36.9% to 1.30m tonnes, with the turnover improving by 40.6% to €65.7m and the EBITDA jumping by 80.2% to €8.1m.

South African volumes fell by 21.7% to 0.56m tonnes as cement demand declined. The turnover was off by 1.4% to €70.8m and the EBITDA came off by 11.9% to €29.6m. The Mozambique cement volume increased by 12.4% to 0.42m tonnes, with turnover improving by 1.6.3% to €43.5m, but the EBITDA was hit by a fire at a local plant and fell by 9.1% to €6.6m. Cape Verde Islands volumes recovered by 7.0% to 0.12m tonnes, but the turnover still declined by 1.8% to €16.3m and the EBITDA dropped by 21.0% to €2.1m.

Cimpor's two Asian markets both saw volumes fall by some 12%. In China cement deliveries declined by 12.4% to 1.65m tonnes, with excess capacity putting pressure on prices, the turnover came off by 21.1% to €36.9m and at the EBITDA level a €2.7m loss was incurred, against a profit €4.3m a year earlier. Some improvement may be possible in the second half. In India, increased competition led to a 12.3% volume reduction to 0.51m tonnes of cement with the turnover declining by 6.5% to €27.4m and the EBITDA dropping 35.4% to €4.8m.