1Q14 turnover declines for Italcementi, while EBITDA recovers

Italcementi's first quarter turnover declined by 3.3 per cent to EUR932.9m while the running EBITDA staged a 10.2 per cent recovery to EUR95.5m. The trading loss was reduced by 74.6 per cent to EUR4.2m and net interest charges increased by 29.3 per cent to EUR33.2m. The pre-tax loss increased by 19.6 per cent to EUR44.2m, but a lower tax charge reduced the net attributable loss by 12.7 per cent to EUR68.3m. The net debt at the end of March was 1.4 per cent lower at EUR2,076.5m, to give a gearing level of 56.3 per cent, compared with 51.3 per cent a year earlier. Capital expenditure in the period more than doubled from EUR64.4m to EUR167.5m, reflecting investment projects in India, Bulgaria and Italy.

Group cement and clinker shipments showed a 1.7 per cent recovery to 10.1Mt, with international trading activities showing a 30.3 per cent volume advance to 0.8Mt. Turnover from cement and clinker trading recovered by 19.7 per cent to EUR46.6m and the EBITDA improved by 31.2 per cent to EUR2.5m. Aggregates shipments were 2.2 per cent lower at 6.9Mt, while ready-mixed concrete deliveries declined by 4.9 per cent to 2.7Mm³. 

The Western European region cement and clinker volumes recovered by 8.5 per cent to 3.34Mt. Consolidated aggregates shipments recovered by three per cent to 6.37Mt but ready-mixed concrete deliveries declined by a further 8.9 per cent to 1.65Mm³. In France and Belgium, turnover improved by 2.5 per cent to EUR327.7m but the EBITDA still declined by 7.2 per cent to EUR34.6m. Cement and clinker volumes improved by 2.7 per cent in France, while in Belgium, including exports, there was a 26.5 per cent increase, but prices were under some pressure. Aggregates shipments were one per cent higher in France but jumped by 32.3 per cent in Belgium, while ready-mixed concrete deliveries rose by 1.6 per cent in France and by 20.4 per cent in Belgium.

The Italian cement and clinker volumes were off by a further one per cent at 1.1Mt and prices weakened in response to competitive pressures, but lower energy costs and overheads led to a strong profit improvement. Downstream, volumes improved by 5.7 per cent in aggregates but dropped by 29.5 per cent to 0.4Mm³ in ready-mixed concrete and trading losses were reduced in both product categories. Turnover in Italy declined by 9.9 per cent to EUR135.6m and the loss at the EBITDA level was substantially reduced from EUR21.5m to EUR0.3m.

The Spanish turnover improved by 14.9 per cent to EUR24.9m and an EBITDA loss of EUR0.5m a year ago was turned into a EUR2.5m profit. The trading loss was reduced by EUR4.4m to EUR9.7m. Total cement and clinker volumes rose by 54.1 per cent, though domestic cement deliveries were down by 1.8 per cent. Aggregates volumes dropped by 39.6 per cent and ready-mixed concrete deliveries by 30.8 per cent. In Greece, turnover showed a 27.5 per cent recovery to EUR6.4m and the EBITDA loss declined from EUR1.4m to EUR0.5m, as cement and clinker volume rose by 31.6 per cent as domestic demand began to recover from a very low base. Aggregates shipments rose by 17.9 per cent and ready-mixed concrete deliveries improved by 20.7 per cent. In Bulgaria, domestic cement and clinker shipments rose by 16.7 per cent as demand began to recover, but overall volumes came off by 15 per cent because of the political situation in Russia.

Egyptian turnover recovered by a modest 0.9 per cent to EUR137.6m, but the EBITDA fell by 25.5 per cent to EUR28.0m, with fuel shortages still having a negative effect. Domestic cement deliveries were stable and thanks to exports, overall volumes did improve by 2.8 per cent. Ready-mixed concrete deliveries declined by 2.9 per cent, but margins were good. The Moroccan turnover declined by a further 4.9 per cent to EUR76.1m and the EBITDA fell by 16.7 per cent to EUR30.9m. Domestic cement and clinker volume declined by 4.7 per cent, but higher exports allowed overall volumes to be broadly maintained. Downstream volumes suffered from increased competitive pressures and deliveries fell by 40.5 per cent in aggregates and by 21.7 per cent in ready-mixed concrete. In Kuwait, cement deliveries fell by 27.2 per cent and ready-mixed concrete volumes by 4.8 per cent.

Turnover in Asia declined by eight per cent to EUR125.1m, but the EBITDA improved by 1.7 per cent to EUR20m and the trading profit advanced by 43.4 per cent to EUR9.7m. In Thailand, turnover improved by four per cent to EUR69.1m and the EBITDA rose by 98.6 per cent to EUR18m. Domestic cement and clinker deliveries rose by 12.5 per cent, but exports declined and the overall volume was ahead by 4.4 per cent. Ready-mixed concrete deliveries jumped by 43.7 per cent. The group's Indian turnover declined by 14.6 per cent to EUR52.3m and the EBITDA dropped by 66.5 per cent to EUR3.6m as pricing pressures intensified. Cement and clinker volume improved by 3.3 per cent but domestic deliveries declined by one per cent. In Kazakhstan, a 19 per cent devaluation of the local currency and a tough winter contributed to a 55.2 per cent reduction in turnover to EUR3.6m and the quarterly winter loss jumped from EUR0.3m to EUR1.7m as cement shipments dropped by 48.6 per cent and ready-mixed concrete deliveries by 32.6 per cent.

North American turnover came off by 17.3 per cent to EUR61.3m in response to the tough winter and the seasonal loss at the EBITDA level jumped by 96.9 per cent to EUR23m. Aggregates shipments fell by 41.2 per cent to 0.2Mta as a major contract was completed while ready-mixed concrete deliveries were off by 6.1 per cent to 0.1Mm³.