Portugal: In the first quarter of 2015, Cimpor's cement and clinker sales fell by 5.3% year-on-year to 6.8Mt. Growth in Argentina, Paraguay, Portugal and South Africa was not enough to offset a downturn in Brazil and Egypt. Sales rose by 7.4% year-on-year to Euro637m, bolstered by an overall rise in average prices. However, Cimpor's earnings before interest, taxes, depreciation and amortisation (EBITDA) of Euro123m reflected the lower activity in the first quarter.
In the Brazilian market, Cimpor's cement sales were affected by the economic contraction. Local constraints on the water supply affected the construction market, which in turn hit cement demand and put pressure on energy costs. In Argentina, Cimpor outperformed growth in local consumption, which was robust. Cement consumption in Paraguay remained dynamic and Cimpor, which is now making use of all of its local production capacity, showed a marked improvement in its EBITDA margin.
In Portugal, after a long period of downturn in consumption, the market returned to growth in the first quarter of 2015. Cimpor said that its Portuguese business managed to capture the growth in domestic market demand while also maintaining its export capacity.
In South Africa, despite strong competition from a new operator in Cimpor's operating region, as well as from imported cement, its commercial policy and the launch of co-processing made it possible to take advantage of growth in local demand. Demand for cement in Egypt was expected to have fallen and was more pronounced in Cimpor's volumes because of an adjustment to its natural market share after posting an unusual level of sales in 2014. This was based on competitors' operations being negatively affected by fuel scarcity.
Cimpor said that a new commercial dynamic introduced into its activities in Mozambique had come to fruition in the first quarter of 2015. Despite a negative market trend over the previous year due to adverse weather and problems with local power supply and increased pressure from importers, cement sales fell only by 1.5% year-on-year.