HeidelbergCement released its financial results for the third quarter of 2018, noting that positive market dynamics continued in all group areas, which led to growth in sales volumes in all business lines.
Group revenue rose by 7 percent in the third quarter to €4.9 billion (previous year: €4.6 billion). Adjusted for negative currency and consolidation effects in the amount of €105 million, revenue even increased by 10 percent. Growth was driven particularly by strong demand in many markets and positive pricing.
Result from current operations before depreciation and amortization (RCOBD) decreased by 2 percent to €1,039 million due to currency and consolidation effects. However, adjusted for these effects, RCOBD grew by 2 percent. Volume growth, successful price increases and efficiency programs more than compensated cost inflation, particularly for energy.
“In the third quarter, the positive revenue and earnings per share trend continued and we could once again earn a premium on our cost of capital,” said Dr. Bernd Scheifele, chairman of the HeidelbergCement managing board. “Improved financial costs and lower taxes overcompensated weaker than expected results from current operations due to significant rainfalls in our core markets in the United States as well as a higher than planned energy cost inflation.”
Dr. Scheifele continued, “However, due to the weaker operational development, we had to partially adapt our outlook for 2018. As a countermeasure, we have initiated an action plan with focus on three levers: portfolio optimization, operational excellence as well as cash flow and shareholder return.”
In the third quarter, HeidelbergCement’s cement and clinker sales volumes rose by 5 percent to 35.1 million metric tons (Mt). Adjusted for the disposal of the white cement business in the United States, deconsolidation of the business in Georgia, and the acquisition of Cementir Italia, the growth rate amounted to 6 percent. All group areas contributed to this increase. While sales volumes in the emerging countries rose above average, North America grew only slightly due to the harsh weather in Texas as well as in the Midwest and Northeast region of the U.S.
Deliveries of aggregates rose by 1 percent to 87.7 Mt. With the exception of the Africa-Eastern Mediterranean Basin, all group areas recorded increasing volumes. Deliveries of ready-mixed concrete grew in all group areas, rising by 4 percent to 12.9 million cubic meters. Asphalt sales volumes improved by 5 percent to 3.4 Mt, owing to the positive demand in the UK and California as well as consolidation effects in the Northwest and Australia. Excluding consolidation effects, sales volumes came in slightly above last year’s level.