Votorantim sees cement revenues fall 10% YoY in 2016

Votorantim, formerly Votorantim Industrial, generated a turnover 8.7 per cent lower at BRL26,738m (EUR8046m) and EBITDA declined by some 38 per cent to around BRL4300m (EUR1,294m) in 2016 when compared with 2015. Although the net interest charge declined by 9.9 per cent to BRL1731m, there was a net loss of BRL1295m compared with a the net profit fell of BRL387m (EUR116.5m). Group capital expenditure was 6.2 per cent lower at BRL3031m (EUR912m), of which cement represented BRL27.3m.

Brazil accounted for 47 per cent of the turnover in 2016, compared with 54 per cent in the previous year. Peru represented 15 per cent and the rest of South America eight per cent, North America 16 per cent, and Europe and the rest of the world nine per cent. Cement accounted for 47 per cent of turnover and 56 per cent of EBITDA, followed by zinc and by-products with 24 per cent of turnover and 31 per cent of EBITDA and aluminium with 17 per cent of turnover but just one per cent of EBITDA.

The falling construction activity in Brazil in 2016 led to an 11.7 per cent reduction in Brazilian cement deliveries in the year and Votorantim Cimentos, as market leader, suffered accordingly. Because of the weakness in Brazil, which accounts for half the company’s turnover, cement deliveries across the group declined by 3.7 per cent to 33.8Mt. This compares with a total capacity of 57.6Mta. Two new works came on stream during 2016 – one with a capacity of 1.2Mta at Primavera in Brazil and the other in Yacuses in Bolivia with a capacity of 0.95Mta.In Brazil the use of alternative fuels was increased by 17 per cent to 21 per cent in 2016 and the aim is to raise this to 40 per cent by 2020.

Canada and the USA account for for 35 per cent of EBITDA, which saw an increase by 13 per cent as both volumes and prices were ahead, helped by a mild winter. Across Europe, Africa and Asia, EBITDA improved by 14 per cent, with the strongest performances coming from Morocco, Tunisia and Spain but currency weakness hit Turkey. In 2016 24.7Mt of aggregates were sold, along with 9.2Mmª of ready-mixed concrete and 1.6Mt of mortar.  Votorantim Cimentos saw its turnover decline by 9.6 per cent to BRL12,697m (EUR3821m) while EBITDA declined by 8.8 per cent to BRL2405m (EUR724m).