The German building materials giant says its integration of Italy-based Italcementi is ahead of schedule, with synergies from the acquisition increased to €470 million.
HeidelbergCement’s consolidated financial statement for 2016 also revealed that cash flow from operations also rose by 29% to €1.9 billion in 2016. The company is proposing a dividend to shareholders of €1.60 per share (+23% on 2015).
Looking ahead to 2017, HeidelbergCement sees a positive outlook for global economy, although notes higher geopolitical and macroeconomic risks. The company is forecasting growth in sales volumes of cement, aggregates, and ready-mixed concrete, along with a moderate increase in revenue.
“2016 was an exceptional year for HeidelbergCement,” states Dr. Bernd Scheifele, chairman of the managing board of HeidelbergCement. “With the successful takeover of Italcementi, we have accelerated our growth and are now in an excellent strategic position. In our core business lines of aggregates, cement, and ready-mixed concrete, we occupy first, second, and third place globally. We have also achieved a major milestone with the investment grade classification by the rating agencies S&P Global Ratings, Moody’s Investors Service, and Fitch Ratings. Thanks to strong operational development and an improved financial result, we have been able to considerably increase our profit for the financial year before non-recurring effects. Our strategic priorities of ‘shareholder returns’ and ‘continuous growth’ are reflected in our figures as well as in the significantly raised dividend proposal.”
HeidelbergCement’s sales volumes of cement, aggregates, and ready-mixed concrete increased significantly as a result of the acquisition of Italcementi. On a pro forma basis, i.e. taking into account the contributions of Italcementi for the full years 2015 and 2016, sales volumes rose moderately in all business lines in comparison with the previous year.
On the one hand, the company benefited from the ongoing recovery in North America and Europe. On the other hand, the weaker demand in Asia – primarily in Indonesia due to the delayed start to infrastructure projects – adversely impacted cement and ready-mixed concrete sales volumes.
