Buzzi Unicem releases 9M16 results
Buzz Unicem reports that from January to September 2016 cement and clinker sales of the group totalled 19.5Mt, up 1.2 per cent from the previous year.
Consolidated net sales were in line with the previous year, increasing from EUR1998.1m in September 2015 to EUR1.9985m in the period under review, while EBITDA came in at EUR416.2m (+64.1m, equal to +18.2 per cent).
Europe
In Italy cement and clinker sales showed a declining trend compared to the same period of 2015, with average sales prices which confirmed the level of the first nine months of 2015. Ready-mix concrete sales volumes were up compared to September 2015, also thanks to the favourable change in scope resulting from the business combination which took place in late May in the Milan area, with prices slightly positive. On the costs front, the favourable trend of fuels offset the increase in electricity prices.
Overall net sales in Italy came in at EUR279.7m, down 1.1 per cent versus EUR282.8m in the previous year while EBITDA, although improving, remained negative at EUR-16.7m compared to EUR-19.7m in 2015. However, the 2016 figure includes among staff costs non-recurring restructuring expenses of EUR0.6m and that the 2015 result included non-recurring net income of EUR1.9m. Net of non-recurring items, EBITDA increased by EUR5.5m.
Positive changes were recorded in Germany, Poland, Ukraine, Luxembourg and the Czech Republic, while in the United States a somewhat weak and subdued summer quarter cancelled the positive change achieved in the first half year. In Germany overall net sales amounted to EUR429.6m, in line with 2015 (EUR429.8m), while EBITDA increased by EUR8.6m (+16.3 per cent), from EUR52.6m to EUR61.2m. In Poland cement volumes sold during the first nine months, thanks to more buoyant dynamics in spring and summer, could confirm a solid increase on the same period last year. In Ukraine in the first nine months, cement shipments from the company's plants, which maintained a regular production activity, showed some upward progress, with average prices strongly recovering, driven by inflation. In Luxembourg and The Netherlands, cement sales, inclusive of internal sales volumes, maintained a solid growth, with average unit revenues slightly down.
In Russia the gradual recovery of shipments from the spring months led to slightly decreasing sales for the first nine months compared to the previous year, with the category of oil well cements, used in the extraction industry, always showing a good performance. Sales prices in local currency remained stable. Net sales decreased from EUR136.2m in 2015 to EUR118.5m (-12.9 per cent) while EBITDA amounted to EUR37.4m compared with EUR40.5m of the previous year (-7.6 per cent).
USA
US cement sales showed a clear decline during the summer months, which resulted in the loss of the already accumulated benefit and volumes basically equal to the ones achieved in the same period last year through September. The weak demand was more marked in the Southwestern region, and in particular in the Houston area, which was already affected by the contraction of shipments of oil well cement, but it also concerned some areas of the Midwest.
Mexico
Mexican cement sales continued to trend in line with the relatively high volumes recorded in 2015, with average prices in local currency progressively improving. Ready-mix concrete sales maintained a weaker profile, but with prices in local currency clearly up. Net sales and EBITDA, in local currency, increased respectively by 11.4 per cent and 30.8 per cent.
The trend in cement prices during the first nine months in local currency strengthened clearly above all in Ukraine and also in the United States. Modest changes occurred in Russia (favourable) and in Italy and the Czech Republic (unfavourable). In Central Europe and in Poland in particular, the decrease in prices was more pronounced.
Ready-mix
Ready-mix concrete sales amounted to 8.8Mm3, down 0.8 per cent compared to the first nine months of 2015, with the confirmation of a higher production in Italy, Germany, Poland and Ukraine, and a slight negative sign in the Czech Republic. Ready-mix concrete prices strengthened in the United States, the Czech Republic, Benelux and Poland. Meanwhile, the change was modest, but unfavourable, in Germany. The EBITDA to sales margin still benefitted from the tailwind in energy costs and the improved efficiency and productivity resulting from the optimisation actions developed by management, thus increasing everywhere. The capacity utilisation in Poland, Ukraine, Central Europe and the Czech Republic was higher than the previous year.
Ready-mix concrete output, mainly located in the southwest USA, slowed down further. The average price trend in local currency remained favourable for cement and showed a slight improvement also for ready-mix concrete. Overall net sales increased from EUR823.5m to EUR831.7m and EBITDA from EUR216.2 to EUR254.2m (+17.6 per cent). The new line in Maryneal (West Texas) is now working at a fairly regular rate, although the conclusive fine tuning will require further efforts in the coming months.
