Displaying items by tag: Results

Switzerland: Holcim's net income has risen by 9% for the first six months of 2012. Despite this, the world's second-largest cement maker plans to cut costs and raise cement prices to meet its financial targets. These have been both hit by poor demand Europe and high-energy costs.

The company's net income attributable to shareholders rose to Euro324m in the January 2012 to June 2012 period from Euro267m in the same period of 2011. Net sales rose by 2%, to Euro8.62bn from Euro8.45bn. Operating earnings before interest, tax, depreciation and amortisation rose by 1.9%, to Euro1.61bn from Euro1.60bn. Sale volumes of cement rose by 4%, to 74Mt from 70.9Mt. Second quarter results for the April 2012 to June 2012 period supported these overall trends.

By region, Holcim's Asia Pacific and Latin America areas showed steady growth while Europe continued its decline. In Asia Pacific sales of cement rose by 8% for the half year, to 41.2Mt from 38.1Mt. In Latin America sales rose by 3.3%, to 12.1Mt from 11.7Mt. In Europe sales fell by 4.1%, to 12.3Mt from 12.8Mt, mainly due to poor performance in the first quarter of 2012. In North America sales rose by 8.6%, to 5.4Mt from 5Mt. In Africa and the Middle East sales rose by 2.7%, to 4.5Mt from 4.4Mt.

"While demand in North America should beat the previous outlook, Holcim now expects a decline in Europe," the Holcim said. The firm's construction industry customers, especially those in southern Europe at the heart of the debt crisis, are suffering as governments slash spending in an attempt to get budgets under control. Analysts at Bank Vontobel said that while Holcim's overall outlook was almost unchanged, the contribution of Europe compared with North America was three times bigger, making this effectively a 'reduction of the outlook'.

The Swiss cement maker said that its spending cuts were under way and would result in an additional operating income of at least Euro125m in 2012.

China: China Resources Cement Holdings (CRC) has reporting a sharp fall in earnings and profit margins for the first half of 2012, dragged down by weaker demand. Despite turnover rising by 9.8% to US$1.42bn for the six months ending 30 June 2012, the company's net profit slumped by 68.9% to US$81.9m over the same period due to sliding selling prices.

CRC has attributed its poor performance to a number of factors including sluggish demand caused by weakened economy and poor weather conditions in the southern part of China, which led to accumulation of inventory as well as a series of price cuts. CRC expects prices to pick up in the fourth quarter of 2012 due to several large infrastructure projects, including resumed construction of railway networks and on-going affordable home-building drives.

Ireland: CRH expects the Eurozone's economic problems to deepen a slide in sales in the second half of 2012, preventing it from raising profits despite a recovery in the US construction market.

For its interim results for the six months ending on 30 June 2012 the Irish building materials group reported a 5% rise in sales revenue, to Euro8.59bn from Euro8.17bn in the same period in 2011. Earnings before interest, tax, depreciation and amortisation (EBITDA) fell by 1% to Euro568m from Euro574m.

"The big question is whether Germany and some of the economies that are performing well can compensate and continue to deliver growth for the Eurozone overall," said chief executive Myles Lee.

"We just don't see how the Eurozone can get their act together in time to have a significant impact in the second half," chief financial officer Maeve Carton added.

Sales in the US, where CRH is the leading producer of asphalt for highway construction, rose 8% on a like-for-like basis in the first half compared with a 5% drop in Europe where bad weather added to governments' debt problems. But CRH noted that the rate of economic growth in the US is tailing off and forecast that sales growth in the second half in the region will be 'well below' the 8% sales growth in the first half.

First-half results were propped up by favourable weather conditions and improving construction markets in the US, with revenue, profit and margin growth across all three of its divisions in the first-half, said CRH. The company said that key European markets such as the Netherlands continue to struggle, while it is expecting a contraction in sales in Poland in the second half of 2012.

The company is seeking to cut costs by more than Euro2bn over a five-year period in response.

India: India Cements has reported a 39% drop in net profit for the quarter ending 30 June 2012. Profit fell to US$11.2m from US$18.4m in the same quarter in 2011. However, the company earnings before interest, taxes and amortisation (EBITDA) rose by 14%, to US$50.9m from US$40.1m.

The Chennai-based cement manufacturer's total income, which also includes revenue from Indian Premier League (IPL) franchise Chennai Super Kings, rose by 13.5% to US$218m from US$192m. Total expenses increased by 13% to US$167m from US$147m, mainly due to higher fuel consumption and transportation costs.

"Our primary focus this quarter has been on maintaining the margins despite increases in rail fares, power tariff revision in our states of operation, increases in wages and a substantial depreciation of Rupee against the US Dollar pushing up prices of imported coal," commented N Srinivasan, vice chairman of India Cements. He also added that in the reported quarter the company has continued to work on infrastructure connecting its coalmines to ports in Indonesia.

Cement production stayed stable for the quarter at 2.35Mt in 2012 against 2.32Mt in 2011. Cement and clinker sales also reported little change, with 23.8Mt in 2012 reported against 23.1Mt in 2011.

Kenya: Lafarge Bamburi Group has posted a 13% drop in its pre-tax profit to stand at US$43.9m for the six months ending 30 June 2012. The group's operating profit was down by 9% to US$42.7m. Both were negatively impacted by continued volatility of global fuel prices, resulting in higher raw material, transport and power costs.

This was further aggravated by the removal of a government power subsidy in Uganda that led to a 70% increase in power prices, which affected the company's Ugandan subsidiary Hima Cement.

Lafarge Bamburi's turnover rose by 17% percent to US$228m, while cash generated from operations during the period under review amounted to US$60.6m, 33% higher than what was generated in 2011.

"The regional cement market will continue to be vibrant," said the company in a statement. "The focus will be on retaining the upward trend of revenue growth. The group will continue to capitalise on progress made in its cost control measures to cushion the top line."

US: Eagle Materials Inc has reported a 29% rise in total revenue for the first quarter of the 2013 fiscal year which ended on 30 June 2012. The North American building materials producer noted revenue of US$154m for the quarter, up from US$120m in the same period in 2011.

Cement sector revenues for the first quarter, including joint venture and intersegment revenues, totalled US$76m, a 26% increase year-on-year from US$59m in 2011. Sales volumes rose by 26%, including wholly-owned and joint ventures, to 848,000t from 674,000t. The revenue improvement reflects a 26% increase in first quarter cement sales volume. Cement price increases were achieved in both the Texas and Mountain regions during the first quarter but were offset by the increased pace of high-volume, lower-priced bid work in the company's other markets.

Operating earnings from cement for the first quarter were US$9.9m, a 12% increase from US$8.8m year-on-year. The earnings impact from increased cement sales volumes was mostly offset by higher maintenance costs associated with scheduled maintenance at all of Eagle's cement facilities. The company calculated that first quarter operating earnings were negatively impacted by approximately US$8m due to this maintenance.

Italy: Italcementi Group has released consolidated results for the six months to 30 June 2012, which show mixed results across its operations. Revenue and earnings were both down, as was the group's net profit, which was drastically down due to the absence of a major one-off receipt seen in the year-ago period. The company announced that it expected the second half of 2012 to be broadly in line with that of 2011.

The group's consolidated revenue for the first half of 2012 was Euro2.29bn compared to Euro2.42bn in the first half of 2011. Recurring earnings before interest, tax, depreciation and amortisation (EBITDA) came in at Euro328.7m compared to Euro371.7m in the first half of 2011. Italcementi's total profit for the period was Euro0.8m, compared to Euro187.8m in the first half of 2011. This apparent drop was due to the absence of a receipt from the sale of Turkish operations, which was conducted in the first half of 2011.

In the first half of 2012 consolidated cement and clinker sales totalled 23.5Mt, a drop of 7.5% compared to the first half of 2011. The reduction was largely due to the decline in central western Europe and, to a lesser degree, in Egypt. Sales in Asia continued to make good progress and sales volumes in North America and Bulgaria showed a strong recovery.

Italcementi said that its first half results confirm the upturn in North America and the recovery in prices in some markets, although demand was down in the Eurozone. Among emerging countries, it recorded positive market performances in India and Morocco, while the sales trend in Egypt remained negative, although better than expected. It added that its withdrawal from the Turkish market a and new strategic agreement in China had generated positive impact on its financial position.

Going forward, Italcementi said that the effects of efficiency measures, together with a positive dynamic in prices on a number of markets should enable it, in the absence of currently unforeseen events, to reach full-year operating margins broadly in line with those of 2011.

Germany: Price increases and cost cutting at HeidelbergCement have halted a slide in cement margins and put the German cement producer on track to reach its 2012 targets.

HeidelbergCement's operating income before depreciation (OIBD) for the quarter ending 30 June 2012 rose by 7% to Euro698m from Euro651m in the same quarter in 2011. Its revenue rose by 11% to Euro3.78bn from Euro3.39bn. The company's efforts to chip away at its cost base, easing energy costs and price increases pushed through in 2012 have all helped HeidelbergCement post a 0.2% improvement in cement margins following steady declines in 2011 and early in 2012.

"We will do everything in our power to continue this positive trend in the second half of 2012," said chief executive Bernd Scheifele in a statement.

Demand for cement has remained robust in North America and Asia, prompting HeidelbergCement to affirm its outlook for a third consecutive year of growth in sales and operating profit. HeidelbergCement has also benefited from a slide of the euro against the US Dollar in the second quarter, which helped boost group revenue growth by 5 percentage points to 11.4%. Net profit was up by 16% to Euro184m.

Cement sales volumes benefited from strong demand in North America and Asia but sales declined in Europe due to decline in infrastructure spending. In western and northern Europe cement and clinker sales volumes fell by 5.1% in the first half of 2012 to 10.2Mt from 10.8Mt in 2011. In eastern Europe and central Asia cement and clinker sales volumes increased by 3.0% to 7.8Mt from 7.6Mt. In North America cement sales grew by 16.7% to 5.4Mt from 4.7Mt. In Asia-Pacific cement and clinker sales grew by 9.5% to 14.8Mt from 13.6Mt.

HeidelbergCement predicts that cement volumes in North America will rise by 8-11% in 2012, compared with a previous forecast of 4-7%. Sales in western and northern Europe could decline by as much as 2%. The company has slashed its global outlook for volumes to 4-6% growth, down from 6-9%, as its assessment of eastern Europe and Africa deteriorated.

"The growth in sales volumes, due to the additional capacities and a more or less significant increase in demand in Russia and central Asia, is being somewhat muted by the latest decline in demand in Poland and the Czech Republic," said HeidelbergCement.

India: Birla Corporation has earned a profit after tax of US$15.3m in the first quarter of the current financial year (ending 30 June 2012) against US$20.2m in the same quarter of the previous year. This represents a more than 24% drop year-on-year. Birla's net sales from operations for the quarter were US$118.5m. 

Commenting on the results, Harsh V Lodha, chairman of the company, said that the profitability of the company continued to be affected due to the closure of limestone mining operations at its Chanderia units on account of an order from the high court of Jodhpur. It was also observed that higher coal and freight prices had caused reduced margins.

India: Two of Holcim's Indian subsidiaries have reported rises in their second quarter 2012 profits. Ambuja Cement has reported a 35% growth in net profit for the quarter ending 30 June 2012 due to increased sales, to US$84.6m from US$62.8m in the same period of 2011. Net sales by the company rose by 17.9% to US$463m during the quarter from US$392m in 2011. Ambuja Cement attributed this to a 7.3% rise in sales volume, to 5.54Mt from 5.16Mt.

During the quarter, absolute Earnings before interest, taxes, depreciation and amortisation (EBITDA) for the company rose by 22.8% to US$133m. However Ambuja Cement declared that higher operational expenses impacted upon this rise. Total expenses for the company, including raw material and power costs, rose by 15.7% to US$354m from US$306m. The company expects that profit margins are likely to remain under pressure due to steep rise in cost driven by higher raw material prices and rise in distribution and freight costs.

Meanwhile, ACC has reported a 26% rise in consolidated net profit for the second quarter of 2012 due to strong revenue growth, to US$74.8m from US$59.2m in the same period in 2011. Total consolidated turnover for ACC in the quarter rose by 15% to US$526m from US$458m in 2011. The company sold 6.05Mt of cement during the quarter compared to 5.93Mt in the same period in 2011.

Like Ambuja Cement, ACC mentioned 'steep' escalations in most of its key input costs including slag, fly ash, gypsum and power. The company also commented that the increase in railway freight rates with effect from March 2012 substantially impacted both inward and outward costs.

Both Ambuja Cement and ACC were fined in June 2012 by the Competition Commission of India for their alleged involvement in a price-fixing cartel. Ambuja Cement was fined US$210m and ACC was fined US$207m. ACC is currently taking steps to appeal against the fine.