Buzzi Unicem
Buzzi Unicem's turnover fell by 21.7% in the first quarter to €459.63m and the EBITDA dropped by 64.6% to €13.92m, resulting in a trading loss that jumped from €12.11m to €40.27m. Kiln fuel costs were lower, but prices for electric energy increased. Net financial costs were 3.2% higher at €33.51m, resulting in a pre-tax loss 64.3% higher at €50.50m. Net debt at the end of March was 9.1% higher at €1,319.7m, which gave a still very comfortable gearing level of 46.6%. Capital investment was slightly lower at €90.3m compared with €98.7m, of which €67.7m were spent on investment projects in Russia, the Ukraine and Mexico. Cement shipments were affected by bad weather and weak demand and declined by 19.6% to 4.4m and group ready-mixed concrete deliveries were off by 14.1% to 2.6m m³. A competitive pricing scene is likely to continue in Italy, Russia and the United States for the remainder of this year.
The Italian cement and clinker volumes dropped by 21.0% compared a relatively good performance in the previous year and some market share was lost. Excess market capacity put pressure on prices, which weakened by 9.9%. Ready-mixed concrete deliveries were down by 10.6% and prices were slightly lower. Turnover fell by 22.5% to €136.2m, but the EBITDA did improve by 14.1% to €6.5m, thanks to the sale of emission rights for €7.6m. German cement volumes were off by 17.0% to 0.73Mt and ready-mixed concrete deliveries declined by 11.0% to 2.6m m³, with virtually all the volume reduction coming in the first two months of the year. Average selling prices for cement eased by 1.1%. Turnover declined by 18.8% to €81.9 and the EBITDA loss widened from €1.4m to €1.8m, with the sale of emission rights for producing €2.5m. Luxembourg, cement and clinker sales were 2.1% lower, but prices improved by 3.9%, and the sales mix also improved, giving rise to a 2.0% improvement in turnover to €15.2m, but higher maintenance costs led to a €1.1m increase in the seasonal loss to €3.4m. The Dutch turnover declined by 22.2% to €19.0m and the EBITDA loss increased from €0.5m to €1.4m on lower volumes in concrete and aggregates.
In Eastern Europe, turnover fell by 25.1% and the EBITDA dropped by 34.3% to €4.8m in a bad winter. In Poland, cement deliveries fell by 22.7%, in Czech Republic by 32.6%, by 41.9% in the Ukraine and by 7.5% in Russia. Average selling prices also suffered in the period, with the exception of the Ukraine, where there was a 7.7% increase. The conversion of the Ukrainian kilns to burn coal is close to being completed, and the dry process production line at Suchoi-Log in Russia should come on stream in early August.
In the United States, first quarter cement shipments were off by 23.2% and average prices declined by 7.7%. Ready-mixed concrete deliveries fell by 12.8% and prices weakened. The turnover fell by 29.7% to €105.9m, while the EBITDA went into negative territory with a €5.6m loss compared with a €14.2m profit, not helped by adverse exchange rate movements. The Mexican associate Corporaciòn Moctezuma recorded a 2.1% reduction in turnover to €46.4m, but the EBITDA improved by 4.7% to €17.0m as the margin advanced to 37.4% and the numbers were also helped by the 5.6% strengthening of the peso against the euro. Cement deliveries declined by 11.0%, but local currency prices did improve by 2.6%. Ready-mixed concrete deliveries rose by 7.0%, but the pricing environment was unfavourable. The new cement works at Apazapan in the state of Veracruz should come on stream in the final quarter of this year.
