HeidelbergCement Posts Strong Results Despite Poor Demand in Europe


As expected, HeidelbergCement posted strong results for 2012. Despite only a 1% increase in total cement sales volume and a 5% drop in aggregates volume, revenue grew 4% on a like-for-like basis and EBITDA improved 3% thanks to price increases in key markets and cost-reduction efforts.

Asia Pacific contributed the most to HeidelbergCement’s earnings improvement. There, cement sales volume grew 4% and EBITDA margins improved to 25.5% from 24.0% in the prior year. To capture expected demand growth in the region, HeidelbergCement is working on significant brownfield and greenfield cement capacity expansion projects in Indonesia.

North America saw an impressive 10% increase in cement sales volume in 2012. EBITDA margins expanded to 16.8% from 15.6% thanks to a positive price trend. North American demand is expected to continue to grow strongly in the coming years–although maybe not always at such a high rate–as the United States recovers from a multiyear downturn in construction activity.

Western and Northern Europe turned in the weakest performance of 2012, and the situation is expected to remain challenging in 2013. In 2012, HeidelbergCement saw a 4% decrease in cement sales volume and a 10% decrease in aggregates sales volume on a like-for-like basis. EBITDA margins compressed to 13.7% from 17.0%.


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