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[March 2009]
HeidelbergCement: Strong Results in 2008
In a difficult environment, HeidelbergCement Group turnover rose by 30.6% to €14.2 billion (previous year: €10.9 billion). Operating income increased by 16% to €2.1 billion (previous year: €1.9 billion). Group share of profit decreased by 10.6% to €1.8 billion (previous year: €2.0 billion). Net indebtedness reduced by around €3 billion to €11.6 billion.
In 2008, HeidelbergCement's strong operational development continued unabated, despite the global economic weakness and declining international building materials markets. In a difficult economic environment, the group increased its turnover by 30.6% to €14.187 billion. The acquisition of Hanson in August 2007 and the successful integration in the 2008 financial year made a significant contribution to this growth. The group also benefited from the healthy operational development in Asia, Africa and the majority of European countries.
Excluding consolidation and exchange rate effects, turnover once again reached the high level of the previous year. The adverse impact of exchange rate effects amounted to approximately €465 million.
The operating income rose by around 16% to €2.147 billion, the highest value in the group's history. Europe made the biggest contribution to this increase, followed by the Asia-Australia-Africa Group area. Although earnings remained significantly below expectations in the United Kingdom and North America, both markets were able to achieve positive results despite the difficult economic environment. In the past year, HeidelbergCement adjusted its capacities in these regions at a very early stage and thus reduced costs. On a like for like basis, the operating income improved by 6.1% overall in comparison with 2007.
"The outstanding achievement of the past year was surely the exceptionally fast and successful integration of Hanson," said Dr Bernd Scheifele, Chairman of the Managing Board. "In our view, the global reorientation of the Group with an integrated business model was the right strategic step to take in order to safeguard the Group's strong earnings potential in the long term and create the basis for future growth. Thanks to the acquisition of Hanson, HeidelbergCement is now the global market leader in aggregates according to sales volumes and has leading positions in the cement and concrete business."
In the past year, the group was already able to benefit significantly in operational terms from the integration of Hanson. Cement and clinker sales volumes rose by 1.3% during the past year to 89 million tonnes (previous year: 87.9 million tonnes). Excluding consolidation effects, this figure would have decreased by 2.3% as a result of the heavy decline in the US market. The deliveries of sand and gravel (aggregates) increased by 66.8% to 299.5 million tonnes (previous year: 179.6 million tonnes).
Excluding the consolidation of Hanson, sales volumes fell by 12.2%. This was primarily caused by the significant decline in demand in North America. Asphalt sales volumes rose by around 152% to 12.1 million tonnes (previous year: 4.8 million tonnes). In operational terms, i.e. excluding consolidation effects, the figure decreased by 16.7%. Ready-mixed concrete sales volumes grew by 35.7% to 44.4 million cubic metres (previous year: 32.7 million cu.m.). Excluding the substantial contribution made by the consolidation of Hanson, sales volumes fell by 5%.
"In order to successfully overcome the exceptional challenges we will face in 2009, HeidelbergCement will focus on consistent cost management and on generating the highest possible cash flow," declared Dr Scheifele. "The ‘Fitness 2009’ programme, additional cost-saving measures and synergy effects from the Hanson integration are expected to have a further significant positive impact on costs this year."
From the second half of 2009, the group expects the first impetus to come from the worldwide economic programmes focusing, for example, on road construction and infrastructure – sectors in which HeidelbergCement is particularly strong throughout the world.
ENDS