Cimpor hit by the weakness in volumes and currencies

Cimpor's nine-month turnover fell by 28.5 per cent to EUR1379.4m and EBITDA dropped by 33.1 per cent to EUR264.6m as cement deliveries in Portugal, Brazil and Argentina declined by 35.7 per cent, 19.8 per cent and 11.7 per cent, respectively, with single-digit reductions being seen in South Africa and Egypt. Mozambique saw shipments improve by 11.2 per cent and Paraguay by 10.8 per cent.

A trading loss of EUR332.3m was declared compared with a trading profit (EBIT) of EUR248.5m a year earlier and the net financial charges increased by 4.9 per cent to EUR287.4m, to give a pretax loss of EUR619.7m compared with EUR25.5m at this stage last year. A tax credit of EUR30.6m compares with a charge of EUR17.2m and the net attributable loss rose from EUR33.7m to EUR5842.7m. Net debt at the end of September stood at EUR3421m, four per cent higher than a year earlier, and because of the asset impairments resulted in shareholders' funds turning negative.

Group cement and clinker shipments declined by 14.7 per cent to 18.01Mt. The turnover from trading and shipping activities fell by 49.0 per cent to some EUR116m, while its contribution to EBITDA fell by a further 48.3 per cent to EUR4m.

The Portuguese turnover declined by 23.1 per cent to EUR167.4m as cement and clinker sales dropped by 35.7 per cent to 2.12Mt, with Portugal's share of the group's cement and clinker volume fell to 11.7 per cent compared with 15.4 per cent a year ago. Production at the Loulé kiln has been suspended. The Cape Verde Islands sold 21.2 per cent more cement at 0.16Mt, with the turnover being 27.9 per cent higher at EUR25.7m. The Portuguese and Cape Verde EBITDA came down by 18.6 per cent to EUR33.4m, as the previous year’s improvement in Portuguese domestic sales went into reverse. 

The Brazilian turnover fell by a further 41.6 per cent to EUR397.3m and lost its position as the largest contributor, while EBITDA dropped by 57.9 per cent to EUR52.4m. The cement output in Brazil declined by 19.2 per cent to 6.55Mt, or from 37.8 per cent of the group total to 36 per cent, and in the third quarter there was a 32 per cent reduction against the third quarter of the previous year, but a 15 per cent improvement on the previous quarter. Further temporary closures of production capacity have been undertaken.

Argentina is the now the largest source of turnover, contributing EUR428.0m, or 28.1 per cent of the group total, a 24 per cent reduction on a year ago. Cement shipments declined by 11.7 per cent to 4.35Mt in the period and the group subsidiary Loma Negra remains the Argentinean market leader by some margin. Cimpor’s operations in Paraguay sold 10.8 per cent more cement at 0.34Mt though the turnover eased by 6.3 per cent to EUR38m. The recently-installed integrated production line reached cruising mode and EBITDA margin rose from 32 to 36 per cent. EBITDA from Argentina and Paraguay, however, declined by 21.4 per cent to EUR111m, maintaining its position as the largest source of profit.

In Egypt cement deliveries eased by 3.9 per cent to 2.38Mt while the new coal mill improved operational flexibility. The Egyptian turnover declined by 13.7 to EUR143.4m. The Egyptian EBITDA margin improved by 0.8 percentage points. In Mozambique cement volumes improved by 11.2 per cent to 1.27Mt, but the turnover declined by 20.1 per cent to EUR96.1m as the local currency fell against the euro. South African cement and clinker deliveries declined by 5.3 per cent to 1.01Mt and the turnover was 20 per cent lower at EUR78.6m. EBITDA from Africa declined by 21.6 per cent to EUR63.8m.