Dyckerhoff’s sharp volume drops in Ukraine, Russia & USA

Dyckerhoff’s sharp volume drops in Ukraine, Russia & USA
04 August 2009

Buzzi Unicem’s quoted subsidiary Dyckerhoff has reported a 32.4% drop in first half turnover to EUR652m, and the EBITDA, before EUR33m of provision releases in Germany, fell by 28.9% to EUR103m.  The results were to some extent affected by a harsh winter.  Capital expenditure in the period six months declined by 12.0% to EUR125m, with the United States and Russia being the two major areas of expenditure during the period.  Cement shipments declined by 27.2% to 6.19m tonnes, with lower volumes in all countries.  The Ukraine fared worst with a 56.0% volume drop, while Poland did best with shipments being down by a comparatively modest 10.9% in spite of a bad winter.

The German turnover fell by 14.5% to EUR247m and the EBITDA by 28.9% to EUR37m, with cement shipments declining by 19.1% to 2.21Mt, with domestic deliveries being down by around 13%.  Cement prices, however, improved by some 8%.
In Poland, turnover fell by 36.0% to EUR57m and the EBITDA dropped by 57.6% to EUR14m.  Cement deliveries declined by 10.9% to 0.67Mt but prices improved by nearly 3%. Turnover from the Czech and Slovak operations fell by 36.0% to EUR80m and the EBITDA dropped by 40.0% to EUR21m.

The Ukraine has suffered the worst from the sharply deteriorating market conditions, with the turnover being down by 68.8% to EUR34m and the previous year’s EUR37m EBITDA being turned into a EUR7m loss because of difficulties in passing on gas price increases to the full.  By next spring the new coal mills should be in place, eliminating the need to burn imported gas.  Cement shipments dropped by 56.0% to 0.58Mt, with the result that three smaller kilns at Volyn have been mothballed and only one of the two kilns at Yugcement is currently operating. In Russia, cement shipments fell by 36.3% to 0.66m tonnes and the company’s prices declined by 35%, albeit from a high level.  Two or three of the four wet kilns are currently working and work is continuing on the assembly of the dry kiln to be lit next spring. 

The US associate, majority-owned by Buzzi Unicem, has considered to suffer from the negative environment, in the context of which the cement price drifted by 2% as cement deliveries fell by 22.7% to 1.23Mt.  Turnover declined by 13.7% to EUR101m and the EBITDA was down by 24.0% to EUR19m. 
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