HeidelbergCement expects further advances in spite of higher energy costs
HeidelbergCement’s first half turnover rose by 9.5% to €5996m, but the EBITDA improved by a more modest 4.6% to €904.3m as energy costs rose and the trading profit advanced by 5.7% to €501.2m. The net interest charge declined by 11.4% to €263.3m, while the pre-tax profit, last year distorted by exceptional items, rose ten-fold to €232.6m. Net debt at the end of June was 5.4% lower at €8574m, giving a gearing level little changed at 71.4%. Capital expenditure in the six months rose by 22.4% to €357.4m, with capital spending for the full year is expected to amount to some €1050m, of which €550m is anticipated to be spent on maintaining the existing business and €500m on expansion projects.
Cement and clinker deliveries rose by 10.5% to 41Mt and aggregates shipments were up by 6.4% to 115.2Mt, while the ready-mixed concrete volume rose by 13.4% to 18.6Mm³ and asphalt sales advanced by 10.8% to 4.1Mt. HC Trading saw trading volumes fall by 12.6% to 4.3Mt as exports to North Africa dropped because of political instability. Turnover from trading in cementitious materials and fuel generated a turnover 17.7% lower at €285m and the EBITDA fell by 41.7% to €6m.
Turnover in the Western and Northern European operations rose by 16.7% to €2109m and the EBITDA advanced by 32% to €298m. Cement and clinker deliveries increased by 15.2% to 10.79Mt, with German volumes advancing by more than 20% and the Swedish, Estonian and Benelux arms also growing strongly, with export sales from Germany, the Benelux and Estonia being ahead and British slag volumes staged a good recovery.
The Eastern European and Central Asian activities recovered strongly with a 25.8% increase in turnover to €607m, but the EBITDA rose by a more modest 12.0% to €106m. Cement deliveries jumped by 24.3% to 7.56m tonnes, thanks to good advances in Poland, the Ukraine, Russia, Kazakhstan and Georgia and the turnover rose by 27.4% to €473m.
New cement terminals were established in Georgia and at Archangel in Russia, the latter being supplied from Norway. The new 2Mta per Tula works in Russia was inaugurated in mid July.
Asia-Pacific turnover improved by 11.1% to €1390m, but the EBITDA declined by 4.8% to €343m. The cement and clinker volume was 3.7% higher at 13.56Mt, giving a 7.2% increase in turnover to €813m. The Chinese joint ventures in the Guangdong and Shaanxi provinces produced less than in the comparative period last year, while in India the previous year’s output was only matched and in Bangladesh the volume increase was modest.
Indocement in Indonesia increased volumes by 10.8% and exports were further reduced to satisfy the growth in domestic demand. Additional capacity is under construction in Indonesia, India and Bangladesh.
In North America, turnover declined by 3.9% to €1311m and the EBITDA fell by 17.2% to €122m, with the trading profit virtually disappearing. Cement deliveries did improve by 0.9% to 4.66Mt, but the cement turnover was down by 6.3% to €385m.
Adverse climatic conditions depressed cement volumes in the north and Mid-West of the USA and also in Canada, but volumes in the south were slightly ahead of last year, but in the west, which includes both California and Texas, HeidelbergCement’s two biggest markets, volumes were ahead. Aggregates deliveries declined by 3.7% to 44.55Mt in the six months and turnover declined by 4.4% to €385m, while asphalt sales fell by 5.1% to 1.15Mt, but ready-mixed concrete deliveries did improve by 2.7% to 2.62Mm³. Building products turnover eased by 0.2% to €329m.
Africa and the Mediterranean reported a turnover 11.7% higher at €513m and the EBITDA improved by 8.6% to €84m. Cement and clinker shipments improved by 11.8% to 4.59Mt and the turnover rose by 14.4% to €366m. Cement sales in Africa forged ahead by 21.2% thanks to higher demand in Gabon, Sierra Leone, Ghana, Togo and Tanzania as well as the newly-consolidated business in the Congo. The Turkish joint venture saw sales of cementitious materials decline by 3.7% because of reduced exports to northern Africa, but domestic deliveries rose by some 10%. Sales of aggregates were 3.5% higher at 7.19Mt thanks to better volumes in Israel. Ready-mixed concrete deliveries improved by 2.9% to 2.55Mm³ as higher volumes in Turkey and Israel more than offset the drop in Spain. Published under Cement News
