Egypt powers Cimpor’s results

Egypt powers Cimpor’s results
27 August 2009

Cimpor’s first half turnover improved by 1.1% to EUR1,023.0m, with significant increases in Egypt and China making up for falling sales on the Iberian Peninsula and in Turkey. 

The rising profitability in Egypt, South Africa and Brazil was sufficient to make up for reductions in Spain, Turkey and Portugal and the EBITDA improved by 6.8% to EUR298m. Margins improved thanks to the strength in come high margin countries and lower downstream sales. After a 16.1% rise in depreciation and provisions charges, the trading profit (EBIT) was just 2.4% ahead at EUR196.5m. A reduction in financial losses, however, led to a 50.4% rise in the pre-tax profit to EUR148.1m. The non-recurrence of tax credits left the net attributable profit unchanged at EUR107.1m. The net debt at the end of June was 8.3% higher at EUR1.867.0m, giving a gearing level of 109.0% compared with 100.1% a year earlier.  Capital expenditure in the period amounted to some EUR143m, primarily on additional production facilities in Turkey, China, Brazil, Morocco and Mozambique. 

Consolidated cement deliveries increased by 2.5% to 13.51Mt, with lower Portuguese shipments being offset by strong growth from Egypt and China. The turnover from international trading and shipping fell by 55.5% to EUR28.7m, but the profit contribution was only 2.5% lower at EUR3m. Group sales of aggregates fell by 10.3% to 6.85Mt.   

Cement and clinker production in Portugal dropped by 30.0% to 2.02Mt, with both export shipments and domestic deliveries showing material reductions.  The Portuguese turnover fell by 18.8% to EUR224.3m but the EBITDA held up relatively well by being off by just 7.1% to EUR75.9m.  The underlying drop in Spain was much sharper, but the initial consolidation of the former Cemex business in the Canary Islands turned an underlying drop approaching 40% into a quite modest reduction of 4.6% to 1.55Mt.  The Spanish turnover was off by 13.8% to EUR161.5m and the EBITDA dropped by 52.7% to EUR22.0m as cement prices declined in response to the excess supply.   

Egyptian cement shipments rose by 25.9% to 2.03m tonnes, thereby overtaking both Portugal and Spain in terms of production, benefiting from last year’s modernisation and strong demand.  Turnover advanced by 63.0% to EUR121.4m and the EBITDA rose by 63.5% to EUR54.3m.  Margins were maintained in spite of higher production costs and, at 44.7%, were the second highest in the group.  In Morocco, cement deliveries were 1.4% higher at 0.60Mt, with the turnover being 8.9% ahead at EUR49.0m but the EBITDA emerged 5.2% lower at EUR20.5m.  Tunisia also experienced a narrowing of margins, with the turnover rising by 10.2% to 37.0m but the EBITDA declined by 5.9% to EUR8.8m, with cement shipments advancing by 2.8% to 0.85Mt.  The Turkish cement market continues to suffer badly from excess capacity and deteriorating prices, with cement and clinker sales falling by 16.1% to 0.95Mt, resulting in a 39.0% reduction in turnover to EUR46.7m and the EBITDA dropping by 49.5% to EUR4.5m. 
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