Building materials giant HeidelbergCement says that its first quarter revenue rose significantly by 11.8% in comparison with the previous year to €4,427m (previous year: €3,958m) amid difficult market conditions.
The company said the Q1 results were impacted by a marked increase in the costs of energy and transport burdens on its current operations.
Excluding consolidation and exchange rate effects, the growth amounted to 13.0%. In particular, price increases in all group areas contributed to the revenue growth. Changes to the scope of consolidation of €170m had a negative effect on revenue, while exchange rate effects of €109 million had a positive impact.
The result from current operations before depreciation and amortisation (RCOBD) fell by €145m, i.e. 26.9%, to €394m (previous year: €538m). Excluding consolidation and exchange rate effects, the operational decline amounted to €140 million, resulting in a figure 25.4% below the previous year’s level.
The decline in result was attributable to the significantly higher costs of energy and transport compared with the same quarter of the previous year, which could only be partially offset despite increases in HeidelbergCement's sales prices. The RCOBD margin, i.e. the ratio of the result from current operations before depreciation and amortisation to revenue, fell to 8.9% (previous year: €13.6m). The result from current operations decreased by 59.3% to €91m (previous year: €223m).
“The first quarter of 2022 was not an easy one for HeidelbergCement,” said Dominik von Achten, chairman of the managing board. “Despite the continuing uncertainties regarding the supply of energy and raw materials and the associated rise in energy prices, we were able to increase our revenue significantly. Although our result declined in comparison with the same quarter of the previous year, which was exceptionally good, it increased in comparison with the equally strong first quarter of 2020.
Although there is still a lot of uncertainty concerning energy and raw material availability and costs, we continue to see strong demand for our products in all regions."
He added that demand for sustainable low-carbon products is growing rapidly, adding that the company is optimistic about the remainder of 2022.
In the first quarter, sales volumes in most business lines were around the same level of the previous year.
At 28.4 million tonnes (previous year: 28.4 million tonnes), group cement and clinker sales volumes remained at the previous year’s level. The consolidation-related decline in sales volumes in North America resulting from the sale of our activities in the West region in October 2021 was offset by the growth in sales volumes in the other group areas. Excluding consolidation effects, the cement and clinker sales volumes increased by 2.1%.
HeidelbergCement has confirmed its outlook for 2022. “Demand for our building materials remains high in all regions, despite the persistently volatile market conditions,” said von Achten. “In addition, the efficiency programmes with a focus on our sales prices and costs are starting to deliver results. We thus expect to see strong growth momentum for the rest of the year.”
The company anticipates strong growth in revenue and a slight increase in the result from current operations, in both cases before consolidation and exchange rate effects.
