Germany: HeidelbergCement has announced that its revenue and sales volumes increased in the first quarter of 2014, although it still made a loss for the period.
Revenue was up by 5.7% year-on-year for the quarter at Euro2.75bn, compared to Euro2.60bn in the first quarter of 2013. Operating income before depreciation (OIBD) was Euro229m, a 15.6% increase from Euro198m. The German multinational reported successful price increases and improved cost control as reasons behind the improved takings. Despite this, the group still reported a net loss of Euro108m for the period, although this constituted an improvement on the Euro187m that it lost in the first quarter of 2013.
HeidelbergCement reported that sales benefitted from warmer than usual weather in Europe. In North America sales volumes were adversely affected by the extremely low temperatures seen as the result of the polar vortex weather phenomenon. Elsewhere, the group reported that Asian and African markets 'continued to develop positively.' Across all of its markets, cement and clinker sales volumes rose by an average of 10% with Europe and Central Asia both reporting double-digit growth.
"Business development in the first quarter has strengthened our confidence in the outlook for the 2014 financial year," said HeidelbergCement's CEO Dr Bernd Scheifele. "Deleveraging in order to regain investment grade rating remains the highest priority for us. To this end, we will continue to be very disciplined in our spending in 2014 and focus more intensively on the sale of the building products business line in the United Kingdom and North America as well as other assets that do not belong to our core business. At the same time, we will remain on course with our successful strategy of targeted expansion of our cement capacities in growth markets."
Going forward, HeidelbergCement expects that North America will see a continuation of its economic recovery and some stabilisation in Eastern Europe. Further rises in demand are expected in Central Asia. In Western Europe, the group expects healthy growth in demand based on the strong fundamentals in Germany, the UK and Benelux.
