Mozambique is Cimpor’s star performer

For the first nine months of 2012, Cimpor’s cement and clinker shipments were 9.4 per cent lower at 18.82Mt, as volumes dropped by just over one -third both in Spain and China while Mozambique proved to be the company's star performer.  The assets to be retained by Cimpor as a result of the agreement between the major shareholders for splitting the Cimpor assets, were actually 0.7 per cent higher at 10.97Mt.

Turnover for the nine months to September 2012 was down by 1.6 per cent to €1170.6m and EBITDA eased by 0.9 per cent to €355.4m. The trading profit (EBIT) declined 1.2 per cent to €247.3m. Net financial charges jumped by 185.3 per cent to €83.4m, as change of control clauses led to debt repayments, giving a pre-tax profit 25.9 per cent lower at €163.9m. The tax charge was 2.7 per cent higher at €55.4m. The profit after tax on a continuing basis fell by 35.1 per cent to €108.5m. 

Net debt at the end of September was 0.3 per cent lower than a year earlier at €1623m, giving a gearing level of 99.1 per cent, compared with 81.2 per cent a year earlier. A reduction in the book value of the Spanish assets was a major factor in the reduction in the value of the net assets.

Performance by region

The Portuguese turnover fell by 16.8 per cent to €249m as cement and clinker sales declined 4.1 per cent to 2.78Mt. While the volume of exports increased, this was insufficient to fully make up for the drop in domestic sales. Thanks to the increase in exports, Portugal’s share of the group’s cement volume increased slightly from 13.9 per cent to 14.8 per cent. In Spain, Cimpor’s cement volumes dropped 33.7 per cent compared with a 15.5 per cent reduction a year ago and the Spanish turnover was off by 26.2 per cent to €145m. For the Iberian peninsula as a whole (which also includes the smallish operation in the Cape Verde Islands with a turnover of €22m) EBITDA fell by 36.7 per cent to €74m. That profit, however, was taken after a substantial, but unquantified gain of the sale of emission rights. 

Brazil, yet again, increased its lead as the largest contributor to cement volume, turnover and profit. The cement output in Brazil rose 3.7 per cent to 4.42Mt, which represented 23.5 per cent of the group total compared with 20 per cent a year earlier. Turnover in Brazil was just 0.5 per cent higher in euro terms at €528m, but the EBITDA did advance by 5.1 per cent to €174m.

Egypt was the third biggest contributor to in terms of cement volume and fourth in terms of turnover. The Egyptian turnover increased by 8.4 per cent to €138m, though cement deliveries declined by two per cent to 2.37Mt. Turkish cement volumes declined by 8.4 per cent to 2.12Mt and the turnover was off by 1.6 per cent to €125m. After a very strong performance a year ago, when competitors had supply problems, Tunisian cement shipments came off by 15.8 per cent to 1.11Mt and the turnover fell by 17.1 per cent to €53m. In Morocco, cement deliveries declined by 5.4 per cent to 0.86Mt in the face of new competition and the turnover eased by 5.94 per cent to €71m. Across the Mediterranean region, the EBITDA came off by 3.4 per cent to €108m.

South African cement deliveries fell 14.2 per cent 0.8Mt in the face of increased competition from imports and the turnover was off by 9.3 per cent to €104m. In Mozambique, cement volumes rose strongly and were  21.9 per cent ahead to 0.86Mt and the turnover rose by 20.2 per cent to €97m. The EBITDA from southern Africa improved by 5.8 per cent overall to €63m. 

China saw a worsening of conditions in the markets where Cimpor trades, with the result that the cement tonnage dropped by 34.9 per cent to 1.82Mt and the turnover came down by 44 per cent to €52m. In India, cement deliveries improved 9.6 per cent to 0.75Mt, and the turnover rose by 18.5 per cent to €45m, although the monsoon caused some reduction in activity during the third quarter. The substantial loss incurred in China led to an overall loss in the India/China region of €6m, compared with a €24m profit a year earlier.

Cimpor restructuring

Camargo Correa’s Austrian subsidiary InterCement Austria Holding is injecting the Camargo Correa subsidiaries in Brazil, Argentina, Paraguay and Angola into a restructured Cimpor in exchange for the operations currently owned by Cimpor in Spain, Turkey, Tunisia, Morocco, China, India and Peru and 21.2 per cent of Cimpor’s consolidated net debt. InterCement Austria will then exchange those assets with Votorantim in return Votorantim’s remaining stake in Cimpor. These assets accounted for 7.85Mt of the 18.82Mt of cementitous materials sold during the nine months.