Germany: HeidelbergCement’s sale revenue, volumes and profits have all been boosted by its acquisition of Italcementi in 2016. Preliminary figures for the group show that its revenue rose by 13% year-on-year to Euro15.2bn in 2016 from Euro13.5bn in 2015. Its cement sales volumes rose by 28% to 104Mt from 81.1Mt and its operating income rose by 7% to Euro2bn from Euro1.85bn. The group said that 2016 had been its best year since the financial crisis in 2008. However, on a pro-forma basis, taking into account the contributions of Italcementi in 2015 and 2016, the group’s sales revenue fell slightly and cement sales volumes and operating income rose far less steeply.
“The year 2016 was an important milestone for HeidelbergCement,” said Bernd Scheifele, chairman of the managing board. “With the acquisition of Italcementi, we made a big leap in growth and achieved the best operating income since the financial crisis. The integration of Italcementi is well under way and offers significant earnings potential resulting from the implementation of identified synergies.”
By region, HeidelbergCement’s Western and Southern Europe division reported rising sales volumes of cement but falling revenue and operating income. Improving markets in Germany and the UK were offset by weak demand in Italy, France and Spain and the falling value of the British Pound versus the Euro. By contrast revenue, cement volumes and operating income were all up in the Northern and Eastern Europe-Central Asia area with a particular emphasis in Norway. Notably, demand growth was also reported in Russia driven by markets in Moscow and St Petersburg. In North America financial figures rose in 2016 but revenue fell in the last quarter of the year. Strong sales were recorded in the north and south of the US but a drop in sale volumes was noted in the Canadian Prairie provinces due to falling oil production. In the group’s Asia area sales volumes rose but revenue and operating income fell in 2016 due to a ‘significant’ fall in prices in Indonesia and Thailand. Finally, in the Africa-Eastern Mediterranean Basin the market picture was mixed with small increases in sales volumes, a drop in sales revenue and a slight increase in operating income due to increased market competition in Sub-Saharan countries.