Brazil contributes 44% of Cimpor’s EBITDA
Cimpor’s first quarter turnover declined by 4.9% to €521.2m and the EBITDA came off by 10.2% to €128m. A further 7.5% reduction in depreciation and provision charges to €49.7m brought about an 11.8% reduction in the trading profit to €78.3m. After net financial costs 8.4% higher at €10.7m, to give a pre-tax profit 14.3% lower at €67.6m and the net attributable profit, after a higher tax charge but a minorities credit of €1.5m, was 15.4% lower at €49m.
Net debt was 0.2% higher at €1,553.4m to give a gearing level of 76.5m, compared with 71.8% a year earlier. The consolidated cement and clinker shipments were 8% lower at 5.88Mt. Although the turnover from trading and shipping eased by 2.7% to €47.2m, the EBITDA shot ahead by 88.0% to €3.9m.
Turnover in Portugal declined 11% to €87.12m and the EBITDA fell 27.1% to €18.2m. Cement and clinker volumes did improve 2.3% to 0.96Mt, thanks to a more than 60% increase in exports, primarily to North Africa and to Latin America. The profit was also negatively affected by the absence of the sale of emission certificates in the period. The Spanish turnover decreased by 18% to €48.8m and the EBITDA dropped by 75.9% to €2.2m. Restructuring costs were incurred to adjust to the lower potential for future volumes and, like in Portugal, there were no sales of emission certificates in view of the low prices obtainable.
Brazil further reinforced its position as the leading source of volumes, turnover and profit. The Brazilian turnover improved by 5.6% to €176.9m, making it more than twice that of the second largest country, Portugal. The EBITDA rose by 12.3% to €56.1m, again a record, and more than three times that of any other country and this represented 43.8% of the group total. Cement and clinker sales rose 7% to 1.44Mt. On the negative side, the exchange rate movements worked against the group this time, there was a substantial rise in electricity costs and margins narrowed in the ready-mixed concrete activities.
In the Middle East, Egypt remains the largest contributor in spite of the turnover declining 12.7% to €44.9m and the EBITDA by 15.9% to €14.1m, with the cement tonnage coming down by 10.4% to 0.8Mt. The increased cement supply in the country and higher kiln fuel and electricity costs were the main factors behind the reduction in profitability. Moroccan turnover improved 4.5% to €25.5m and the EBITDA rose by 11.8% to €8.8m. Cement volume advanced 5.5% to 0.31Mt but because of increased competition, the cement had to be sold over a wider area, increasing transport costs. The Tunisian turnover declined by 5.5% to €19.6m and the EBITDA came off by 7% to €4.9m as competitive pressure returned and volumes were off by 7.7% to 0.41Mt. Turkey was hit by a particularly hard winter, which let to a 35.4% drop in cement volume to 0.33Mt. The turnover fell 33.5% to €19.8m and the EBITDA dropped 60.7% to €1.5m. Cement prices did rise in spite of the drop in volumes. However, higher energy costs and the devaluation of the Turkish pound had a negative effect on the results in addition to the low volumes.
The South African turnover improved 7% to €35.6m and the EBITDA rose by 20.8% to €14.2m, thanks to a better mix and the ability to pass on cost increases. Cement volumes declined 2.9% to 0.27Mt, entirely because of lower export volumes. In Mozambique, cement deliveries rose 13% to 0.22Mt. Turnover was up slightly less, or by 11.5% to €25.5m, as increased competition led to pressure on prices. An improved industrial performance still enabled Cimpor to raise the EBITDA 37.9% to €4.3m. In the small Cape Verde market, volumes were stable, but turnover fell by 11.4% and prices by 19.1%.
Chinese volumes fell by 25.8% to 0.6Mt as regional demand wakened and the supply was increased, with both volume and prices in decline. Turnover fell 34.2% to €18m and the EBITDA went from a positive €4.4m to a loss of €3.8m. In India, volumes were off by 1.5% to 0.27Mt, with the turnover improving by 3.7% to €16.2m, but the EBITDA fell 11.3% to €2.5m as notable increases in both coal and electricity prices had to be absorbed in a competitive market, where a 9% price increase just covered the increase in energy costs.
