Heidelberg Materials reports record results in 2023

Heidelberg Materials has reported record preliminary results for 2023 with group revenue up four per cent YoY to EUR21.2bn, despite what the company describes as a “weak market environment”. The result from current operations (RCO) improved by 29 per cent YoY to EUR3bn, while profit for the year attributable to shareholders came in at EUR1929m, up from EUR1597m in the previous year. The return on invested capital (ROIC) increased to 10.3 per cent in 2023, compared to to 9.1 per cent in 2022, exceeding 10 per cent for the first time. 

“Despite a persistently difficult market environment, we closed the past financial year with a record result,” said Dr Dominik von Achten, chairman of the managing board of Heidelberg Materials. “We achieved new all-time peaks in all of our key figures. In the 150th year of our company’s history, we have once again shown that we can deal with change and crises.”

According to the company, volumes in 2023 developed differently in the individual group areas but decreased in all business lines in comparison with the previous year. High inflation rates, increased financing costs, and persistently high energy and raw material prices have significantly impaired construction activity over the last 12 months, impacting demand for building materials. The decline in demand in private residential construction could not be offset by a solid development in industrial commercial construction and infrastructure projects. 

However, price adjustments across the company more than compensated for this fall in volumes. Active cost and price management as well as slightly lower energy costs led to a 19.2 per cent increase in result from current operations before depreciation and amortisation (RCOBD) to EUR4258m on a like-for-like basis, up from EUR3739m in 2022.  

In terms of sustainability, Heidelberg Materials reported a further three per cent reduction in specific net CO₂ emissions to 534kg/t of cementitious material in 2023, compared to the previous year. This was attributed to a reduced clinker ratio and increased proportion of non-fossil fuels. 2023 also saw the company expand its range of low-carbon and circular products, including its evoBuild® brand.

“With evoZero®, the world’s first carbon captured net-zero cement, we are paving the way for the future of construction,” it said in a statement. evoZero®’s net-zero footprint results from the use of industrial-scale carbon capture and storage (CCS) technology, which is being deployed for the first time at Heidelberg Materials’ plant in Brevik, Norway. 

Looking ahead, the company expects 2024 to see demand in the construction sector stabilise at a low level and cost developments in the energy and raw materials markets to remain volatile. The focus going forward will, therefore, be on price adjustments and strict cost management. The company anticipates further revenue growth this year and an RCO of EUR3-3.3bn, with an ROIC of around 10 per cent.