Cement Hranice 2012 outlook, Czech Republic

Despite reporting an increase in 2011 cement sales, Czech cement producer Cement Hranice company expects a decline this year the Euro zone sovereign debt crisis and a continuing fall in construction output.

Last year the company increased sales by 14.5 per cent last year to CZK1.69bn (EUR69m) following two years of declining sales due to a downturn in the domestic construction industry. Net profit in 2011 reached CZK499m, an increase of 10 YoY.

Cement Hranice's results improved last year thanks to supplies to sister company in Poland, the firm's board of directors chairman Jaromir Chmela said in the annual report.

"Poland has not been affected by a crisis in the construction segment yet because it was preparing infrastructure for the European football championship," Chmela said. Hungary and Slovakia were the other major export destinations.

Although the company sold more product last year, it generated lower revenue per tonne of cement due to a decline in prices. "Prices on the domestic market fell by nine per cent on average and export prices dropped by 13 per cent," Chmela said.