HeidelbergCement reported a good start to 2020 despite a rough March. Compared with the strong January and February of the previous year, sales volumes increased in all business lines. From mid-March, however, sales volumes were significantly impaired by the effects of the coronavirus pandemic, such as state-imposed production downtimes and construction stoppages on major infrastructure projects.
During the first quarter of 2020, total cement and clinker sales volumes decreased by 3% to 27.7 million tonnes. Deliveries of aggregates declined by 4% to 60.1 million tonnes, and ready-mixed concrete sales volumes fell by 6% to 10.7 million cubic metres. At 1.8 million tonnes, asphalt sales volumes were 4% below the previous year’s level.
Group revenue decreased by 7% in comparison with the previous year to €3,930 million. Excluding consolidation and exchange rate effects, the decline amounted to 8%. Changes to the scope of consolidation of €6 million ($6.5 million) had a negative impact on revenue; exchange rate effects, on the other hand, increased revenue by €23 million ($25.1 million). However, the overall positive price development only partially offset the decline in sales volumes and trading activities.
The result from current operations before depreciation and amortization grew by 3% to €405 million ($442.4 million). Excluding consolidation and exchange rate effects, the growth amounted to 2%. The result from current operations rose by 5% to €59 million ($64.4 million). Excluding consolidation and exchange rate effects, the growth amounted to 4%.
“HeidelbergCement has made a good start to 2020. Until mid-March, construction activity worldwide was only slightly impaired by the effects of the coronavirus pandemic, and our results increased in comparison with the previous year,” Dr. Dominik von Achten, chairman of the managing board of HeidelbergCement, said.
“From mid-February, we acted promptly and comprehensively to take the measures that were necessary given the situation. In doing so, the health of our employees, customers, and service providers has always been and remains a priority. The low number of infected employees within the Group speaks for itself. I would like to thank all employees worldwide for their daily commitment to our customers – sometimes under difficult circumstances – and for keeping construction activity going wherever possible,” he said.
Dr. von Achten continued, “With COPE, we have launched a comprehensive action plan across the Group at the end of February that focuses on cost savings and on maintaining our high level of liquidity. This includes, for example, minimizing all non-essential expenses, reducing personnel costs, voluntary reductions in management salaries, restrictions on investments, and reduced tax payments. Our objective is to reduce expenses by €1 billion with these measures.
“The positive start to the year demonstrates that HeidelbergCement is very well positioned even in difficult times. When the economy picks up again and construction activity in our markets returns to normal, we will still have good, perhaps even better prospects for sustainable and profitable growth,” he concluded.