Italcementi boosted by developing markets and France
Italcementi’s first half turnover rose by 6.5% to ú2,262.1m as cement and clinker volumes rose by 7.0% to 23.9m tonnes, while ready-mixed concrete deliveries were just 1.5%higher at 10.5m mÑ but the aggregates tonnage grew by 7.3% to 29.7m tonnes. The operating profit at the EBITDA level advanced by 9.6% to €538.2m, with the strongest growth being achieved in Asia and in other developing markets.
The European Union represented a turnover of €1,700.3m, an increase of 6.7% with the EBITDA ahead by 7.8% to €387.9m on cement volumes 4.1% higher at 13.1m tonnes, or some 55% of the group total. In terms of downstream activities, the EU weighs much more heavily in that it accounted for 8.9m m©&hibar; of 10.5m m©&hibar; of ready-mixed concrete supplied by the group and for 28.5m of the 29.7m tonnes of aggregates. The Italian cement operations reported 3.9% increase in turnover but the trading profit declined in response to higher costs, principally for energy. France, on the other hand, generated a 22.4% increase in trading profit to €125m on a 10.5% increase in turnover and a 7.5% rise in cement deliveries. A construction industry strike in Andalusia reduced the profit growth in Spain to just 0.6% and cement deliveries were 1.9% lower. Belgian deliveries fell by 4.2% and ready-mixed concrete volumes suffered more markedly as independent concrete producers gained market share on the back of cheap Westphalian cement. Domestic deliveries in Greece were down by 1.9% as Olympic preparations has passed their peak, but export shipments recovered, pushing up the overall cement volume.
North American turnover rose by 14.2% in local currency and by 2.8% on conversion to €244.5m, helped by kinder weather and good levels of construction activity. The result was that the EBITDA jumped from €9.9m to €39.4m as cement deliveries rose by 10.2% to 3.2m tonnes and prices improved. In Asia, turnover rose by 21.0% to €122.9m and the EBITDA was up by 27.0% to €42.6m, with Thailand, the main contributor, increasing total cement deliveries by 24.3% and domestic deliveries by 9.2%. Cement deliveries in Kazakhstan and India rose by 16.7% and 12.6% respectively, but pricing n southern India remains unsatisfactory in view of the over-capacity there.
In terms of major capital investment, the Italcementi group is building a new one million tonnes per annum clinker line at its Malaga works in the Spanish province of Andalusia. When the new kiln comes on stream, towards the end of 2006, it will replace two existing kilns, while increasing capacity by 15% and reducing costs by in excess of 20%. The investment at Martinsburg, in the United States, scheduled to come on stream a year later will increase capacity by 40% and cut production costs in half as four wet process kilns at two different plants are replaced by a single kiln. Furthermore, the group is looking for opportunities to expand its North African operations to close the gap between Morocco ant its Egyptian associate.
