Cementir's 1H18 cement and clinker sales fall to 4.9Mt
Cementir Holding's sales volumes of cement and clinker in 1H18, equal to 4.9Mt, were essentially unchanged compared to the 1H17, despite the change in the scope of consolidation. On a like-for-like basis, sales of cement and clinker dropped (-3.8 per cent) due to the worse performance of Egypt and Turkey, which suffered slowdowns in the second quarter because of June elections and Ramadan.
EBITDA was EUR96m, up 9.5 per cent on EUR87.7m in the 1H17. Sales volumes of ready-mixed concrete, 2.5Mm3, grew 7.2 per cent driven by the Turkish market and to a lesser extent of Denmark, despite the drop in sales in Norway, and stability in Belgium and Sweden.
In the aggregates segment, sales volumes amounted to 4.9Mt, up by 5.1 per cent thanks to the positive trend in Belgium and Denmark. Group revenue from sales and services totalled EUR588.5m, up 5.7 per cent compared to EUR556.9m in the 1H17.
Profit before taxes was EUR94m (EUR40.5m in the 1H17).
Profit from continuing operations totalled EUR80.1m (EUR27.7m in the 1H17), after taxes amounting to EUR13.9m (EU12.8m in the same period 2017). Net financial debt at 30 June 2018 was EUR395.3m, down EUR141.3m compared to 31 December 2017.
"Results in the first half 2018 are better than those in the first half of 2017 even on a like-for-like basis; without the effect of the acquisition of Lehigh White Cement Company. The improved EBITDA in Turkey, Belgium and China compensated for the worse results in Egypt due to the curfew introduced in February and resulting stop to all transport activities until May, and the worse results in Norway, Malaysia and Denmark. Results were also negatively impacted by harsh weather conditions in the first quarter of the year in Scandinavian countries and Belgium and by Ramadan in Turkey and Egypt," commented Francesco Caltagirone Jr, Chairman and Chief Executive Officer.
Cement volumes 1H18
In Denmark the 1H18 sales volumes of grey cement on the domestic market dropped moderately due to the freezing weather conditions and the completion of the Copenhagen metro, whereas average sales prices have increased slightly. White cement volumes on the domestic market have dropped 11 per cent with prices down slightly.
However, export performance was positive for both white cement (+4 per cent) thanks to larger amounts delivered in the UK, France and Germany, more than offsetting the lower sales in the USA, Finland and Poland, and for grey cement (+18 per cent), especially to Iceland, Greenland, Faroe Islands and Germany, outweighing the lower sales in Norway. Average export prices have fallen due to the different mix destination countries.
Egypt's army started a major security operation in the Sinai area, blocking all transport activities. Exports were halted the same day and domestic sales stopped on 20 February, having exhausted stocks in the Suez warehouse. Production of clinker stopped on 22 February before starting up again in full on 16 April. Quantities of white cement sold on the domestic market dropped by 15 per cent with average prices in local currency increasing 18 per cent. Export volumes to all main destinations fell 49 per cent, with sales prices in dollars down on all the main markets.
In Belgium in the first six months of 2018 Compagnie des Ciments Belges group sales volumes of grey cement and clinker dropped slightly (-1.7 per cent) compared to the first half of the previous year.
In Turkey cement revenue in local currency increased by about 30 per cent. Group sales volumes of cement and clinker dropped during the 1H18 (-4 per cent) with a strong slowdown in second quarter activities. In the first half, domestic market sales volumes increased by eight per cent whereas cement and clinker exports dropped 75 per cent.
In North America (United States), the subsidiary Lehigh White Cement Company consolidated line by line as of the second quarter 2018, contributed considerably to results with white cement sales volumes of about 178,000t, revenue from sales of EUR36.1m and EBITDA of EUR6.4m.
In China revenue from sales in local currency increased 6.1 per cent compared to the first half of the previous year thanks to favourable prices (+9 per cent on cement in local currency) and an improved product mix, said Cementir.
In Australia sales volumes of white cement and clinker increased three per cent overall compared to the first half of the previous year. Sales volumes of cement on the domestic market fell moderately (-3.5 per cent) although prices in local currency were slightly higher (+5 per cent). Prospects seem positive for the next few months.
Exports of cement and clinker increased by about four per cent, with an increase in cement volumes especially in Australia, Vietnam, South Korea, Philippines and Cambodia and a drop in clinker sales in Australia.
Performance in the second quarter of 2018
In the second quarter of 2018, sales volumes of cement and clinker, equal to 2.8Mt, dropped 3.1 per cent. On a like-for-like basis, the reduction in volumes suffered from the worse performance in Turkey due to June elections, and to a lesser extent in Denmark and Egypt.
Sales volumes of ready-mixed concrete, 1.4Mm3, grew 7.3 per cent driven by the excellent trend in Turkey, Denmark and Sweden despite the drop in volumes in Belgium, whereas they were stable in Norway. In the aggregates segment, sales volumes amounted to 2.7Mt, up 2.4 per cent thanks to the positive trend in Belgium and Denmark.
Revenue from sales and services was EUR346.1m, up 11.4 per cent compared to EUR 310.6m in the 2Q17 due to the change in the scope of consolidation (EUR36.1m).
