Displaying items by tag: Results
Eagle Cement builds profit on higher sales volumes
13 November 2017Philippines: Eagle Cement’s net profit rose by 8% year-on-year to US$64.4m in the first nine months of 2017 from US$59.7m in the same period in 2016. It attributed the growth to higher sales volume despite tight competition, according to the Manila Bulletin newspaper. Its net sales revenue grew by 12% to US$219m from US$196m. This was due to over 20% growth in the sales volume of bagged and bulk cement even though the price of cement has fallen, in part because of imports. The cement producer is set to commission a third production line at its Bulacan plant in 2018.
Buzzi Unicem’s revenue boosted by European and US sales
10 November 2017Italy: Buzzi Unicem’s revenue in the third quarter of 2017 has been boosted by strong sales in the US, Italy, Germany and Russia. Overall, its net sales rose by 6.7% to Euro2.13bn in the first nine months of 2017 from Euro2.00bn in the same period in 2016. Its cement sales volumes rose by 4.1% to 20.3Mt from 19.5Mt.
The group said that, although its operating performance was penalised at the end of August and in September 2017 by the impact of hurricane Harvey along the Texas coast, sales volumes of the group grew due to its acquisition of Zillo Group, which started in July 2017. With the exception of Ukraine, all countries in which the company operates in recorded gains in shipments and a marked increase was noted in Italy, Germany, the Czech Republic and Luxembourg.
Italy: Sales in Scandinavia and the US have stabilised Cementir’s growth so far in 2017. Its sales volumes of cement and clinker increased by 1.7% year-on-year, on a like-for-like basis, to 9.6Mt in the first nine months of 2017. This was attributed to a ‘favourable’ performance in Denmark, Egypt, Malaysia and China, slight growth in Turkey, although Italy recorded a downturn in sales volumes.
The group’s sales revenue remained flat at Euro964m for the period, on a like-for-like basis, despite the negative impact of foreign exchange rates. The group said that the positive trend of revenue in Norway, Denmark, Sweden, China and Italy offset a drop in Turkey and the fall in revenues expressed in Euros in Egypt, while revenue performance in Malaysia was almost stable. Cementir’s earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 0.6%, on a like-for-like basis, to Euro152m.
"The results in the first nine months of 2017 were slightly better than management expected following the strong performance of the Nordic and Baltic and US, despite the lower earnings in Turkey and the unfavourable exchange rates. The results benefited from the effect of the acquisitions in the second half of 2016, which contributed Euro30.5m to EBITDA,” said Francesco Caltagirone Jr, chairman and chief executive officer (CEO).
India: Shree Cement’s sale revenue fell by 5.8% year-on-year to US$807m in the six months to the end of September 2017 from US$761m in the same period in 2016. Its profit fell by 18.4% to US$100m from US$123m. However, its sales and profit rose for its cement business and fell its power business.
Q3 multinational cement producer roundup
08 November 2017The third quarter financial results for HeidelbergCement are out today. They aren’t perfect but the company is hanging in there following its acquisition of Italcementi in late 2016. As one would expect both cement sales volumes and sales revenue are up on a double-digit basis. After all, HeidelbergCement has absorbed a major competitor, including assets, staff, cement plants and all. Its volumes and revenue have improved, more importantly though, on a like-for-like basis, even if it is modest. With the US and Europe driving sales the cement producer has time to make its promised synergies following the Italian acquisition and hopefully wait out recovery in places like Indonesia and Egypt.
Graph 1: Cement sales volumes for selected multinational cement producers during the first nine months of 2017. Source: Company financial reports.
That growth on a like-for-like basis is crucial compared to HeidelbergCement’s big rival, the world’s biggest cement producer, LafargeHolcim. As Graph 1 shows sales volumes data for the major multinational cement producers shows quite a varied picture. LafargeHolcim’s sales volumes have fallen by 12% year-on-year to 156Mt but the company has also been reducing its production capacity. Despite this, a rough calculation of its production utilisation rate suggests that it is selling less cement proportionally, although the company’s like-for-like figures disagree, positing a rise of 1.8%. Cemex’s sales volumes declined slightly to 51.3Mt. The larger regional companies show interesting trends. UltraTech Cement has managed to increase its sales volumes by 5% to 40.4Mt overcoming a poor third quarter in 2016. What to watch here will be whether this will be enough to overcome the effects of demonetisation that rocked India’s economy in late 2016.
Graph 2: Sales revenue for selected multinational cement producers during the first nine months of 2017. Source: Company financial reports.
The stronger regional positions of those last two companies really hits home when sales revenue is examined. As can be seen in Graph 2 both UltraTech Cement and Dangote Cement are growing their sales revenue, the latter despite dropping sales volumes. UltraTech Cement is suffering from falling profits due to rising fuel costs and it may yet suffer from ‘corporate indigestion’ as it digests its acquisition of 21.2Mt/yr cement production capacity from Jaiprakash Associates that took place in June 2017. Dangote Cement seems to have increased its earnings and profits despite problems at home in Nigeria by improving its fuel mix. Yet, flirtations with South Africa’s PPC aside, its expansion plans remain in a holding position. Dangote Cement presents another fascinating situation. Its overall sales volumes have fallen but this reflects a failing market at home in Nigeria and doesn’t show the company’s booming sales in the rest of Sub-Saharan Africa.
Results from CRH and the Brazilian companies Votorantim and InterCement will further flesh out the situation when they are released. Yet, the difference between worldwide producers and regional producers seems to be clear. The likes of LafargeHolcim and Cemex with a global presence are generally battling stagnation in the cement markets overall with a couple of key markets holding them back. Meanwhile, larger regional producers in the right locations are growing. However, the absence of the Brazilian producers is critical here as their experience of the floundering market in Brazil is very different to that of, say, UltraTech Cement’s in India. Looking ahead, the next quarter will be particularly interesting to see how demonetisation skewed UltraTech Cement’s performance, to start to see the first results from HeidelbergCement a year after its purchase of Italcementi and how well LafargeHolcim’s new chief is doing.
HeidelbergCement sales start to build so far in 2017
08 November 2017Germany: HeidelbergCement has started to build its sales revenue following its acquisition of Italcementi with growth in Europe and North America. Its sales rose by 19% year-on-year to Euro13bn in the first nine months of 2017 from Euro10.9bn in the same period in 2016. On a like-for-like basis this rose by 1.1%. Its cement and clinker sales volumes rose by 29.2% to 94.4Mt from 73Mt or by 0.3% on a like-for-like basis.
“As expected, the positive trend reversal in May 2017 led to a significantly improved development of results in the third quarter”, said chairman of the managing board, Bernd Scheifele. “North America, Australia, Morocco, India, as well as Northern and Eastern Europe have developed very strongly. The countries of Southern Europe are showing clear signs of recovery, and the emerging countries have passed their lowest point. We have succeeded in reducing the rise in energy costs through the flexible use of various fuels.” He added that the synergies from the acquisition of Italcementi have already ‘significantly’ exceeded the target for 2017.
By region cement sales volumes rose in all regions on both a consolidated and pro forma basis except for the group’s Northern and Eastern Europe - Central Asia and its Asia-Pacific regions. In the US strong markets were noted in California and Washington alongside price growth. In Indonesia the cement producer said that despite the market showing signs of recovery it was still facing price pressure. In Egypt continued reduced market demand was reported.
Tanzania: Tanga Cement’s earnings have fallen significantly due to low cement prices. It operating earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 72% year-on-year to US$2.26m in the first half of 2017. However, its sales revenue grew by 2% to US$35m from US$34.2m.The cement producer cut its prices in response to competition, raising its sales volumes and increasing its market share.
Vicat grows cement sales so far in 2017
07 November 2017France: Vicat’s cement sales have grown by 4.3%, at constant scope and exchange rates, to Euro932m in the first nine months of 2017. Its cement sales volumes rose by 1.6% year-on-year to 16.9Mt from 16.6Mt. Overall, the construction materials company’s sales increased by 2.9% to Euro1.92bn from Euro1.87bn.
“In the first nine months of the year our sales grew at a healthy pace. This was achieved through further growth in the US, despite tough weather conditions in the South east, and a gradual improvement in the French, Indian and Kazakh markets. After very unfavourable weather conditions in the first half, our business in Turkey posted brisk growth again in the third quarter. Lastly, our sales were almost stable in the West Africa and Middle East region,” said group chairman and chief executive officer (CEO) Guy Sidos.
Siam Cement’s sales up so far in 2017 due to regional expansion
07 November 2017Thailand: Siam Cement Company’s (SCG) sales revenue from its cement business has increased so far in 2017 due to contributions from expanded operations in the Association of Southeast Asian Nations (ASEAN) region. Its sales rose by 2% year-on-year to US$4bn for the first nine months of 2017. However, its earnings before interest, taxation, depreciation and amortisation fell by 6% to US$526m, mainly due to weaker demand in Thailand.
Tanga Cement warns of profit drop in first half of 2017
03 November 2017Tanzania: Tanga Cement has issued a profit warning for the first half of 2017. It expects its operating profit before interest and tax for the six months that ended on 30 June 2017 to be 125 - 135% lower than that achieved in the same period in 2016. The cement producer blamed the competitive local market leading to lower prices. It also attributed the profit loss to new competitors using imported clinker.