Heidelberg Materials has reported stable financial results for 2024, with group revenue amounting to EUR21.16bn (US$22.2bn), reflecting a marginal 0.1 per cent decline from the previous year’s EUR21.18bn. The result from current operations (RCO) increased by six per cent to EUR3.2bn, while the result from current operations before depreciation and amortisation (RCOBD) rose by 5.7 per cent to EUR4.5bn. Return on invested capital (ROIC) stood at 9.9 per cent, slightly below the previous year’s 10.3 per cent. Earnings per share declined from EUR10.43 in 2023 to EUR9.87.
The company continued to focus on operational efficiency and cost management. Cash flow from operating activities increased slightly to EUR3.23bn, while net debt remained stable at EUR5.29bn, bringing the leverage ratio to 1.18x. Investments grew to EUR2.14bn, up from EUR1.85bn in 2023, with EUR1.3bn allocated to property, plant and equipment, and EUR843m directed towards financial assets. The company also completed the first tranche of its EUR1.2bn share buyback programme, repurchasing 3.6m shares at a total cost of EUR350m. The second tranche is scheduled to commence in 2Q25 following the Annual General Meeting.
Sustainability remained a key focus area. Specific net CO2 emissions were reduced by 1.3 per cent to 527kg/t of cementitious material. The alternative fuel rate rose from 29.9 per cent in 2023 to 31.2 per cent, and the clinker ratio decreased to 69.2 per cent. In line with its long-term efficiency strategy, Heidelberg Materials launched its “Transformation Accelerator” initiative in November 2024, a programme aimed at optimising network operations, improving efficiency, and implementing global technical initiatives. The initiative is expected to contribute EUR500m annually by 2026.
Regional performance
Regional performance was mixed, with notable improvements in North America offsetting weaker results in other markets. North America remained the company’s best-performing region, with revenue increasing by 1.8 per cent to EUR5.31bn. The region’s RCO saw significant growth, rising by 22.6 per cent to EUR1.05bn. The improvement was attributed to operational efficiencies, strong demand in key areas and the continued benefit of modernisation projects, particularly at the Mitchell cement plant. Growth was strongest in the Midwest and Southeast regions, where fly ash deliveries from the SEFA Group acquisition contributed to higher volumes, while the Northwest and Northeast regions experienced a slight decline in sales.
In Europe revenue declined by one per cent to EUR9.47bn due to weak market conditions in western and southern Europe, where construction activity remained subdued. Eastern European markets showed resilience, but volume growth in the region was not sufficient to offset the decline in western Europe. RCO in Europe fell by 1.7 per cent to EUR1.34bn, reflecting weaker market dynamics and inflationary pressures on raw materials and energy costs.
The Asia-Pacific region saw revenue decrease by four per cent to EUR3.55bn, largely driven by weaker demand in India, Thailand and Bangladesh, where sluggish construction markets dampened cement consumption. However, Indonesia saw significant growth in cement and clinker volumes, mitigating some of the downturn in other parts of the region. RCO for the region increased by 1.6 per cent to EUR405m, supported by operational cost controls and improvements in production efficiency.
In Africa-Mediterranean-western Asia, revenue remained stable at EUR2.3bn, but RCO fell by 3.4 per cent to EUR450m. The region faced ongoing macroeconomic challenges, including high inflation and currency devaluations, particularly in Egypt and Türkiye. While sales volumes were steady across most markets, profitability was impacted by rising input costs and a difficult economic environment in some countries.
Outlook
Looking ahead, Heidelberg Materials forecasts continued earnings growth in 2025, with RCO projected to be between EUR3.25bn-3.55bn. ROIC is expected to remain at approximately 10 per cent. The company will maintain its focus on cost management, price optimisation and operational efficiency in response to ongoing volatility in the construction sector. Demand in Europe is anticipated to remain soft, particularly in western and southern regions, while eastern Europe may continue to provide some counterbalance. North America is expected to drive growth, supported by government infrastructure investments and strong private sector activity. The company will also continue to expand its low-carbon product portfolio, with the first deliveries of its carbon-captured evoZero® cement expected in 2025.
