In its year-end trading statement, the management of RMC takes a more optimistic view in stating that the 2003 results will be at the top end of analysts’ expectations. This is in part on the back of improved performance at the Rugby kiln, where clinker production has averaged 100,000 tonnes per month over nine consecutive months. Elsewhere in the British operations, volumes in ready-mixed concrete and aggregates are lower, but aggregates margins have risen though the profits from ready-mixed concrete have declined. In concrete products, railway sleepers feature as a particularly strongly performing product.
Lower cement prices and ready-mixed concrete margins are likely to result in a loss of some €65m from the German operations in 2003. The pricing scene has now improved and volumes appear to be close to the low point. This, along with a further re-organisation of the German business might possibly allow a loss to be avoided in 2004 if the announced price increases materialise.
France is unlikely to be able to repeat the record profits achieved in 2002, but Spain is performing strongly. In eastern Europe, strong performances have been recorded in Croatia and in the Czech Republic, both countries where RMC produces cement, while Polish volumes have recovered in the second half of the year.
In spite of adverse exchange rate movements and weaker markets outside the housebuilding sphere, the US operations are set to report an improved performance, thanks to the strength of the residential sector and a reduction in the cost base. Elsewhere overseas, the Australian business, in the process of being sold, has had the benefit of increased volumes, while in the Arabian Gulf volumes are ahead but in Israel demand in continuing to suffer from the political situation, even if profitability there has improved.
