Eagle's results hit by negative arbitration award

Including its share of the jointly-owned Texas Lehigh Cement, Eagle Materials turnover for the first nine months to 31 December, rose 4.7% to US$442.7m. Trading profit, before corporate overheads, declined 13.7% to US$49.4m, of which cement contributed 79.9%.

The actual trading profit before exceptional items fell by 17.6% to US$36.8m.  After a net interest charge 1.9% higher at US$13.4m and exceptional charges of US$11.2m, that includes a US$9.1m arbitration award against the group, the pre-tax profit fell by 61.2% to US$12.3m. Net profit dropped by 53.3% to US$12.0m.  Shareholders' funds at the end of December amounted to US$462.5m, 1.3% less than a year earlier, giving a gearing level of 66.6% compared with 69.7% a year earlier.

Turnover in cement rose by 5.3% in the period to US$191.2m.  Of this, the wholly-owned operations saw turnover inch ahead by 0.8% to US$125.7m, while the group's share of the Texas joint venture with HeidelbergCement rose 15.3% to US$64.5m.  Margins narrowed and the trading profit eased by 4% to US$39.4m. 

Cement deliveries attributable to the group improved by 4.5% to 1.99Mt (2.19Mt), with volumes at the Buda joint venture with increasing by 7%, while the subsidiaries sold 3.5% more.  The average cement price achieved over the first nine months edged up by 0.3% to US$89.03/t (US$80.77/st), with the price for the third quarter being 0.1% lower at US$88.21/t (US$80.02/st).

Aggregates and ready-mixed concrete contributed a turnover that was 3.6% higher at US$35.5m but a trading loss of US$0.8m was incurred compared with a profit of US$0.9m. The aggregates volume declined by 12.0% to 1.67Mt (1.85Mst) but the average price did improve by 5.1% to US$6.56 per tonne (US$5.95/st). Ready-mixed concrete deliveries rose by 10.8% to 0.3Mm³, though the average price declined by 1.0% to US$83.69/m3.