HeidelbergCement’s first-half 2019 revenue increased by around 7% to €9.2 billion thanks to solid demand and price increases, according to the company.
“Despite a persistently challenging environment, we increased our revenue and result in the first half of 2019,” said Dr. Bernd Scheifele, chairman of the managing board of HeidelbergCement. “In general, the market dynamics weakened slightly in the second quarter in comparison with the first quarter. Nevertheless, we were able to improve our result in the second quarter because of our strong global positioning. Good margins in Asia as well as Western and Southern Europe more than compensated for the weaker business due to adverse weather conditions in North America and the Africa-Eastern Mediterranean Basin Group area.”
In the first half of 2019, HeidelbergCement made further progress in optimizing its portfolio with the conclusion of several important transactions. These include increases in its shareholdings to 100% in California Commercial Asphalt in the United States and in Nordic Precast Group in Northern Europe, from 50% and 60%, respectively, and the acquisition of the aggregates and ready-mixed concrete activities of Cemex in Central France. Overall, cash-relevant maintenance and growth investments, including the increase in ownership interests in subsidiaries, fell to €590 million in the first half of the year. Cash-relevant divestments, including the decrease in ownership interests in subsidiaries, amounted to €290 million.
HeidelbergCement expects that the favorable development of energy costs in comparison with the previous year as well as the solid development in Europe, North America and Asia, especially in Indonesia, will contribute positively to the result in 2019. In view of these expectations, the overall positive economic development, and the solid first half of the year, HeidelbergCement confirms its outlook for the whole of 2019.
The company anticipates a rise in sales volumes for the core products cement, aggregates and ready-mixed concrete, and continues to assume that in 2019, revenue, result from current operations before IFRS 16, exchange rate and consolidation effects, and the profit for the financial year before non-recurring effects will increase moderately (+3% to +9%).
“We are confident about the second half of the year,” remarked Dr. Scheifele. “We are continuing to focus on our action plan to accelerate the portfolio optimization and increase our margins as well as cash flow.”