Germany: HeidelbergCement has announced its results for the first quarter of 2016. While its revenue was completely flat at Euro2.8bn, cement volumes rose from 16.8Mt in the first quarter of 2015 to 17.6Mt in the first quarter of 2016. However, the group maintained an operating loss of Euro72m, albeit a significant improvement on the Euro123m lost a year earlier. HeidelbergCement’s net debt was down by Euro237m to Euro5.9bn.
The group highlighted improving demand in the US as among the reasons for its improved performance. Cement volumes increased by 6% year-on-year in each of the two years to March 2016. Revenue in the US and Canada was Euro714m, a rise of 14.6% year-on-year. Net income for the region was Euro24m, a turnaround from a loss of Euro18m in the first quarter of 2015.
In Western Europe, positive cement sales trends were led by Germany and the UK, with the Netherlands and Belgium also contributing well. Cement sales in the region were up by 3.1% year-on-year for the quarter to a total of 3.4Mt. Volumes were also up in Scandinavia (1.7% year-on-year), Eastern Europe (6.6%) and in the group’s Central Asia, Russia and Ukraine region (0.7%).
In Western and Southern Europe revenue was down by 2.1% to Euro683m. The region, however, saw a loss of Euro8m for the quarter. Cement sales revenue improved by 1.8% to Euro290m, against a backdrop of falling aggregates, ready mix and asphalt revenues.
In North and Eastern Europe and Central Asia, cement volumes were 2.9% up year-on-year to 3.9Mt. Revenue for the region was Euro420m, a rise of 9.7% year-on-year, with cement revenues up nearly 7% to Euro225m. The group’s net loss in this region increased marginally, to Euro28m from Euro25m a year earlier.
In the group’s Asia-Pacific region, Indonesia saw better market conditions, driven by the arrival of new infrastructure works. India saw moderate increases in volume and Australia also improved. China saw lower prices and sales volumes. The total volume of cement sold in the region during the quarter was 5.8Mt and the region’s revenue was Euro637m. This generated a profit of Euro120m, a 18.8% decline on the preceding year’s profit of Euro148m.
In Africa and the Eastern Mediterranean Basin cement volumes were virtually flat at 1.9Mt. Total revenue was slightly down from Euro252m in 2015 to Euro240m in the three months to March 2016. Revenues from cement-based operations were down by 8.7% to Euro177m.
Excluding exchange rate and consolidation effects, HeidelbergCement now expects a moderate increase in revenue and a high single to double digit increase in operating income and before non-recurring effects profit for the financial year. The company also expects increases in sales volumes of cement, aggregates and ready-mixed concrete.
