Displaying items by tag: Results
China: Anhui Conch Cement recorded consolidated sales revenue of US$27.0bn in 2020, up by 12% year-on-year from US$24.0bn in 2019. Its net profit rose by 5% to US$5.38bn from US$5.14bn.The company said that its total assets were US$30.8bn in 2019, representing an increase of 12% from the end of last year.
CRH grows earnings in difficult year in 2020
04 March 2021Ireland: CRH’s consolidated earnings before interest, taxation, depreciation and amortisation (EBITDA) grew by 5% year-on-year on a like-for-like basis to US$4.6bn in 2020 from US$4.5bn in 2019. Sales fell by 2% to US$27.6bn from US$28.1bn. The group reported a net debt/EBITDA ratio of 1.3x, its lowest since 2010.
Chief executive officer Albert Manifold said, "Our 2020 performance is testament to the commitment of our people and the strength and resilience of our business model. Through the repositioning of our business in recent years and our relentless focus on continuous business improvement, we have delivered record levels of profitability, margins and cash generation. Although the near-term outlook remains uncertain, our unique portfolio of businesses together with the strength of our balance sheet leaves us well positioned to capitalise on the growth opportunities that lie ahead."
By division the group reported growth in its US cement sales volumes in 2020 on a like-for-like basis due to demand in the west, surpassing the negative effects of the coronavirus pandemic elsewhere. However, volumes fell in Canada, particularly in the first half of the year. In 2020, CRH adopted the Ash Grove brand for all its North American cement businesses, unifying 12 cement plants and 42 cement terminals under one brand. In Europe sales and earnings fell due to poor markets in the west despite better conditions on the east. The group noted that it grew its profit in the Philippines due to a strong recovery in the second half and cost savings despite plant shutdowns.
2020 roundup for the cement multinationals
03 March 2021LafargeHolcim’s financial results for 2020 arrived this week, giving us data on many of the larger multinational cement producers. The Chinese ones are yet to release their results and some of the larger other ones such as CRH, Votorantim and InterCement are pending too. Yet, what we have so far gives a selective view on an unusual year. Revenue was down for most producers year-on-year in 2020 due to the effects of the coronavirus pandemic upon construction activity and demand for building materials. There were large regional differences between how countries implemented different lockdowns, how markets responded and how they bounced back afterwards. Generally, the financial effects of this were felt in the first half of 2020 with recovery in the second.
Graph 1: Sales revenue from selected cement producers in 2019 and 2020. Source: Company reports. Note: Figures calculated for Indian producers.
Graph 2: Cement sales volumes from selected cement producers in 2019 and 2020. Source: Company reports. Note: Figures calculated for Indian producers.
LafargeHolcim’s figure in Graph 1 above is a little misleading given that it has divested assets. Its like-for-like reduction in net sales was more like 6%, a similar figure to HeidelbergCement’s. Both experienced mixed results in North America and Europe but not terribly so. LafargeHolcim did relatively well in Latin America. HeidelbergCement found growth in its Africa-Eastern Mediterranean Basin region. It’s also worth noting the comparative leverage of each company: 1.4x for LafargeHolcim and 1.86x for HeidelbergCement. Both are slimming down but the latter’s ongoing divestment plan (see GCW 494) can be seen in the context of its debt to earnings ratio and the cash crisis that coronavirus threw up in 2020.
The contrast between these companies and Cemex and Buzzi Unicem is striking. Both of these benefitted from operations in the North America and parts of Europe. In Cemex’s case sales in Mexico and the US, made the difference despite falling sales elsewhere. Buzzi Unicem’s sales also held up in the US especially in the second half of the year. Europe was more mixed for both producers with growth reported in Germany but losses elsewhere.
The Indian producers tell a different story but one no less notable. Despite a near complete shutdown of production for around a month from late March 2020, the regional market largely recovered. As UltraTech Cement told it in January 2021, “Recovery from the Covid-19 led disruption of the economy has been rapid. This has been fuelled by quicker demand stabilisation, supply side restoration and greater cost efficiencies.” It added that rural residential housing had driven growth and that government-infrastructure projects had helped too. It expects pent-up urban demand to improve with the gradual return of the migrant workforce.
Unfortunately, Semen Indonesia, the leading Indonesian producer, suffered as the country’s production overcapacity was further hit by scaling back of government-based infrastructure projects as it tackled the health situation instead. Its solution has been to focus on export markets instead with new countries including Myanmar, Brunei Darussalam and Taiwan added in 2020 joining existing ones such as China, Australia and Bangladesh. The company’s total sales volumes may have fallen by 8% year-on-year to 40Mt in 2020 but sales outside of Indonesia, including exports, grew by 23% to 6.3Mt.
On a final note it’s sobering to see that the third largest seller of cement in this line-up was UltraTech Cement, a mainly regional producer. Regional in this sense though refers to India, the world’s second largest cement market. By installed production capacity it’s the fifth largest company in the world after CNBM, Anhui Conch, LafargeHolcim and HeidelbergCement. This move towards regionalisation among the large cement producers can also be seen in the large western-based multinationals as they are heading towards fewer but more selective locations. More on the world’s largest producer, China, when the producers start to releases their financial results towards the end of March 2021. Whatever 2021 brings, let’s hope it’s better than 2020.
Caribbean Cement grows sales in 2020 due to local market
03 March 2021Jamaica: Caribbean Cement’s revenue grew by 13% year-on-year to US$134m in 2020 from US$119m in 2019. Operating earnings rose by 32% to US$42m from US$28.8m. The subsidiary of Mexico-based Cemex said that he increase in revenue was related to stronger domestic demand and the company's capacity to supply the local market.
LafargeHolcim consolidated sales and recurring earnings fall in 2020
26 February 2021Switzerland: LafargeHolcim’s consolidated net sales in 2020 were Euro21.1bn, down by 5.6% year-on-year on a like-for-like basis from Euro24.4bn in 2019. The group recorded recurring earnings before interest and taxation (EBIT) of Euro3.35bn, down by 2% from Euro3.74bn. Its cement sales fell to 190Mt, down by 7% from 208Mt. It noted an increase in bagged cement sales in emerging markets.
By region the group reported like-for-like growth in sales and earnings in Asia-Pacific driven by recovery in India and China despite weaknesses in the Philippines and Australia. Earnings rose despite falling sales in Europe, Latin America and North America with a resilient market noted in Central Europe and an ‘outstanding’ year reported in Latin America. Middle East Africa reported falling cement demand and adverse market affects from the coronavirus pandemic, although Nigeria remained buoyant.
Chief executive officer Jan Jenisch said, “2020 was an unprecedented year for everyone, challenging us to be more resilient, while stepping up to take care of those around us.” He added, “This crisis has really proven the resilience of our strategy and business model. By the fourth quarter of 2020 we were back to growth, with a 1.5% increase in net sales and over-proportional recurring EBIT of 14%.” The group completed eight ‘bolt-on’ acquisitions in 2020 and signed an agreement to acquire Firestone Building Products, a producer of flat-roofing systems in the US. It also claimed that, “Every tonne of cement we produced in 2020 was more carbon-efficient and contained more recycled material than the year before.”
Elementia’s consolidated volumes, sales and earnings grow in 2020
26 February 2021Mexico: Elementia sold 5.3Mt of cement in 2020, up by 4% year-on-year from 5.1Mt in 2019. Consolidated net sales rose by 8% to US$1.34bn from US$1.24bn, while earnings before interest, depreciation, taxation and amortisation (EBITDA) rose by 8% to US$170m from US$157m. Cement business sales rose in all regions with the exception of Central America with particular earnings growth record in the US.
The company also noted that the sale of its integrated Bath plant in Pennsylvania, US remained under review by competition authorities with a response hoped for in April 2021. The sale of the unit to HeidelbergCement-subsidiary Lehigh Hanson was first announced in September 2019.
Cementos Argos reports consolidated sales and profit drop in 2020
25 February 2021Colombia: Cementos Argos’ full-year consolidated net sales in 2020 were US$2.52bn, down by 4% year-on-year from US$2.62bn in 2019. The group’s cement volumes declined by 9% to 14.7Mt from 16.1Mt. Net profit for the year was US$21.8m, down by 36% from US$34.1m. Volumes, sales and earnings before interest, taxation, depreciation and amortisation (EBITDA) declined in all three of the group’s regions.
The company said that in the fourth quarter of 2020 the construction sector maintained a ‘positive trend,’ supported by the strong performance of the residential segment. It also recorded a slight improvement in the infrastructure segment. The producer said that warehouses and data centre projects had partially offset the weak performance of the segment, as offices and retail had been the most impacted during the coronavirus pandemic.
Chief executive officer Juan Esteban Calle, “I would like thank each one of our employees for their full commitment and resilience during 2020. I believe the experience we all lived over the last year will lead us to be even stronger and more prepared to face the opportunities and challenges of the future.”
Adbri’s revenue hit by lower demand in 2020
24 February 2021Australia: Adbri’s revenue fell by 4% year-on-year to US$1.15bn in 2020 from US$1.20bn in 2019. Underlying earnings before interest, taxation, depreciation and amortisation (EBITDA) decreased by 3% to US$216m from US$222m. Despite construction growth in Western Australia, cement volumes were reported as being down by 7.1%. The company said that clinker volumes dropped by 23% due to lower offtake by its Sunstake Cement joint venture partner Boral. It added that the impact of the coronavirus pandemic had been ‘well managed’ and that all sites remained operational.
“In the context of the challenging operating environment, the financial outcomes we delivered for the 2020 financial year are better than we had expected and reflect the successes of our cost-out and business improvement programs. Adbri also benefitted from improving demand in the Western Australian market during the period which offset slowing demand in east coast markets, particularly in New South Wales,” said Nick Miller, Adbri’s chief executive officer.
HeidelbergCement publishes preliminary 2020 results
23 February 2021Germany: HeidelbergCement’s preliminary results show a 5% decline in revenue on a like-for-like basis to Euro17.6bn from Euro18.9m. Cement volumes fell by 3% to 122Mt from 126Mt. Its result from current operations before depreciation and amortisation (RCOBD) rose by 6% to Euro3.71bn from Euro3.58bn. Revenues and cement volumes declined in all regions except Africa-Eastern Mediterranean Basin, where revenues rose by 7% and volumes rose by 10%, and Northern and Eastern Europe-Central Asia, where revenues rose by 3%.
The group attributed the general decline to the impacts of the coronavirus on construction’s activity levels, and therefore demand for building materials. A ‘significant improvement’ in results in the second half of 2020 resulted from its own cost-saving programmes and the economic recovery in mid-2020. The producer implemented a major carbon capture and storage (CCS) scale-up in the form of its LEILAC (Low Emissions Intensity Lime And Cement) collaborative project. Throughout the year, it reduced its debt by Euro1.5bn.
Dominik von Achten, chair of the managing board said, "We closed the 2020 financial year with a top result. We were able to not only reach but exceed our forecast for all key figures. The key to this success was the good operational performance across our market regions and business lines. We managed to more than compensate for the coronavirus-related decline in sales volumes through consistent spending discipline. This is a great result of the entire HeidelbergCement team, of which I am very proud. My thanks therefore go to all employees for their extraordinary commitment in the past year."
Eurocement’s earnings rise by 6% in 2020
22 February 2021Russia: Eurocement recorded earnings before interest, taxation, depreciation and amortisation (EBITDA) of US$182m in 2020, up by 6% year-on-year from US$172m. Sales remained consistent with 2019 levels at US$674m.
Interfax reports that the Auction House of the Russian Federation partly disclosed the group’s 2020 results in a presentation related to the sale of its parent company, GFI Investments, and related debts. Potential investors have until 15 March 2021 to submit price indications. The sale is scheduled for conclusion in April 2021.