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04 May 2011

Holcim's double digit aggregates gain

First publishedon www.AggBusiness.com
Holcim has reported strong growth in its aggregates business in the first quarter of 2011 with volumes up 16.3% to 34.3million tonnes, however raw materials and energy prices impacted on profitability. Sales for the whole group were also down 1.8% to CHF4.65billion compared to the same period in 2010 and EBITDA was down 17.1% to CHF753million.

The company said that it experienced higher sales volumes in all segments, and in several markets prices could be adjusted. However, this was not enough to fully absorb the above-average cost increases for raw materials and energy sources, such as coal and petcoke, as well as for distribution.

With regards to Europe, Holcim said that the mild winter in large parts of the region was favourable to construction activity in the first quarter of 2011. Holcim said that demand for building materials picked up in virtually all markets. “The recovery mostly came from the private sector; public sector construction continued to suffer from budget restrictions,” said the company in a statement.

Aggregate Industries UK increased its deliveries of ready mixed concrete, with brisk demand in the Greater London area particularly supporting sales. Due to government stimulus measures, sales volumes of aggregates and asphalt were nearly maintained.

“Holcim France Benelux increased sales volumes across its entire product range. Demand for building materials was particularly positive in Eastern France, where the company benefited from the acquisition of additional gravel quarries and ready mixed concrete plants in Alsace.

“In Germany, the economic recovery was an impetus for both private and public sector construction projects. Holcim Germany and Holcim Southern Germany delivered higher volumes in all product segments.

“Due to brisk construction activity, Holcim Switzerland increased its deliveries in all segments, with ready-mix concrete enjoying particularly strong demand. In a competitive environment, Holcim Italy was able to maintain its cement sales. The work for the 2015

World Expo in Milan provided an especially positive note. However, the company sold less aggregates and ready-mix concrete. In Spain, residential and infrastructure construction remained virtually idle.

“In Eastern Europe, the difficult economic environment persisted. Despite investment in infrastructure, construction activity remained weak overall. Nevertheless, due to the low figures in the previous year and the mild weather conditions, the Group companies, with the exception of Hungary, increased delivery volumes. The strongest increases in cement sales were achieved in Bulgaria, Romania and the Czech Republic.

“The Russian economy continued to recover due to government stimulus measures. Driven by infrastructure and municipal housing activity, Alpha Cement sold more cement. The construction work on the new kiln line at the Shurovo plant meant that clinker had to be brought in from the sister plant in Volsk. In Azerbaijan too, Garadagh Cement sold more cement.”

Holcim reported that consolidated cement sales in European market increased by 19.9% to 5.2million tonnes. Deliveries of aggregates rose by 16.7% to 18.3million tonnes, and Ready mixed concrete sales increased by 15.7% to 3.6million cubic meters. Sales of asphalt grew by 3.9% to 1.5million tonnes.

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Aggregate Industries
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