Buzzi Unicem net profit down on declines in Central Europe, Italy

Buzzi Unicem net profit down on declines in Central Europe, Italy
01 April 2013


Buzzi Unicem said on Thursday it posted an attributable net loss of EUR28.5m in 2012 compared with a profit of EUR27m in 2011, due to declines in Central Europe and a major slowdown of building activity in its domestic market of Italy. Improvements were, however, seen in the United States, Russia and Mexico.

On a turnover that edged ahead by 0.9 per cent to EUR2813.4m, Buzzi Unicem's EBITDA improved by 4.8 per cent to EUR455.1m and the trading profit (EBIT) was ahead by 3.3 per cent to EUR197m. After a net interest charge 21.7 per cent higher at EUR126.1m, the pre-tax profit emerged 8.8 per cent lower at EUR77.8m.

Net debt at the end of the year was 4.5 per cent higher at EUR1187.8m, while shareholders' funds declined by 5.3 per cent to EUR2428.2m to give a gearing of 48.9 per cent.

Domestic demand falls for sixth consecutive year

Volumes declined by 3.4 per cent to 27.3Mt in cement and by 9.5 per cent to 13.6m m³ in ready-mixed concrete. Italian domestic cement deliveries fell for the sixth consecutive year, with the total cement and clinker volume dropping by 19.9 per cent. In spite of the drop in volumes, the average price did increase by a further 13.4 per cent, but the previous year's income from the sale of emission rights could not be achieved and the income from this source declined yet again.

The German turnover declined by 5.1 per cent to €604m and the EBITDA was off by 20 per cent to EUR72.2m. Receipts from the sale of emission rights fell by a further 31 per cent to €1.8m, but the average cement price did improve by 1.6 per cent. Cement deliveries were down by 8.2 per cent to 5.96m tonnes while ready-mixed concrete deliveries were off just 1.4 per cent to 3.99m m³, but the small aggregates arm boosted volumes by 59.5 per cent to 1.04Mt. Capital expenditure rose by 38.2 per cent to EUR34.7m. The Luxembourg turnover declined by 7.7 per cent to EUR104.1m and the EBITDA fell by an underlying 33 per cent to EUR13.8m, with cement deliveries being 7.7 per cent lower at 1.22Mt. The Dutch turnover came off by 20.2 per cent to €87.5m and an EBITDA loss of €5.5m was incurred, with the aggregates tonnage falling by a further 17.4 per cent to 2.72Mt. Capital investment was more than doublet to €6.0m.

The Polish turnover fell by 24.3 per cent to €109m and the EBITDA dropped by 41 per cent to EUR21.8m in spite of a EUR1.5m contribution from the sale of emission certificates. Cement deliveries were down by 17.8 per cent to 1.33Mt.  In the Czech Republic and in Slovakia, turnover was off by 13 per cent to EUR149.6m and the EBITDA fell by 27.9 per cent to EUR25.4m. The cement volume declined by 11.9 per cent to 0.85Mt, the aggregates tonnage by 19.3 per cent to 1.27m tonnes and ready-mixed concrete deliveries by 5.9 per cent to 1.61Mm³, with prices easing by 2.3 per cent. Volumes in the two countries are expected begin to recover during 2013.

Ukrainian turnover advanced by 19.5 per cent to €134.3m and the EBITDA more than doubled to EUR15.8m, helped additionally by favourable exchange rate movements. Cement deliveries declined by 6.1 per cent to 1.79Mt, but ready-mixed concrete deliveries improved by three per cent to 0.17Mm³. Capital expenditure was 4.7 per cent higher at EUR9m. In Russia, turnover increased by 33.7 per cent to €234.6m and the EBITDA advanced by 46.3 per cent to €96.7m, helped by rising volumes and full use of the dry process kiln as cement shipments rose by a further 15.7 per cent to 2.81Mt and selling prices advancing by 13.1 per cent in local currency.

US shipments recover

Helped by a stronger dollar, the United States turnover improved by 22 per cent to EUR680.5m and the EBITDA jumped by 73.7 per cent to €123.9m, helped by a EUR7.8m gain on property disposals. Excluding the disposal gains, the EBITDA margin rose from 12.8 per cent to 15.2 per cent. Cement shipments recovered by 10.5 per cent to 6.82Mt and the average selling price improved by 2.9 per cent in local currency and there was a better underlying margin Buzzi Unicem expects a further improvement in volumes and results in 2013.

Stronger peso helps Mexican turnover

The 50 per cent-owned Mexican associate Corporaciòn Moctezuma increased cement shipments by 6.2 per cent to in excess of 5.8Mt and cement prices improved by 4.3 per cent in local currency. A stronger Mexican peso allowed the turnover to increase by 13.1 per cent to EUR269.2m, compared with a 10.6 per cent increase in local currency. The EBITDA rose by 18 per cent to EUR97.5m, helped by lower fuel costs and improved capacity utilisation and the margin improved from 34.7 per cent to 326.2 per cent. 

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Tagged Under: Buzzi Unicem Italy Results