HeidelbergCement Q4 meets expectation on 20% jump

Improving demand in Europe and Asia help gains and company reach 78 million tons of cement sold for the year; deleveraging still top of the list.

{reg} Operating profit before depreciation (OIBD) in the fourth quarter rose by 20.6 percent from the year-earlier period to 598 million euros ($818.9 million), very narrowly missing the 633 million euros predicted by analysts in a Reuters poll, according to Reuters. For 2010, the ceompany sold 1.2 percent less cement in terms of tonnage at 78.4 million tons, compared to 2009.

HeidelbergCement saw a positive overall volume trend that continued in Q4 despite early and extreme winter start in Europe with like-for-like sales volumes of cement, aggregates, and ready-mixed concrete increased in comparison with Q4 2009.

For 2011, the company sees sustained growth in Asia-Pacific and Africa-Mediterranean Basin and continuation of recovery in North America and Europe. Chief Executive Bernd Scheifele said that in 2011 the group would continue to focus on deleveraging and cash generation.

"We are pleased with our Q4 results, which we realized despite an extremely early and harsh winter start in our European core markets,” said Dr. Bernd Scheifele, CEO of HeidelbergCement. “We have successfully completed our “FitnessPlus 2010” cost saving programme generating EUR 300 million savings in 2010. With our advantageous geographical positioning in growth markets and the successful continuation of our efficiency and cost-saving programmes we are one of the first building materials companies to leave the crisis behind us and achieve increasing turnover and operating income.”

Heidelberg said that the economic development in 2010 was overall better than expected. However, in 2011, it expected that development dynamics of economic growth still  differ from region to region; In Asia and Africa, the positive trend is expected to continue. An improvement of economic output is also anticipated for North America and Europe, but uncertainties still remain regarding the strength and timescale of the economic recovery because of the high level of unemployment and national debt in individual countries.