HeidelbergCement to focus on free cash flow generation

“Focus on the next years will be on the implementation of digital platforms in order to drive savings of in total more than €200 million in operations, maintenance, logistics, and purchasing,” the company said.

“On top of that, HeidelbergCement expects to benefit from market improvements, as core markets in Southern and Eastern Europe, as well as in emerging countries, enter the recovery and expansion phase of the current economic cycle. In total, the company assumes an organic EBITDA growth of around 5% per year over the three-year period.

The company also said it would streamline its portfolio, divesting non-core, high-risk, or idled assets to fund a strengthening of the business in existing geographies. Over the three years to 2020, it expects asset sales of between €1 billion and €1.5 billion to finance acquisitions of between €1.5 billion and €2 billion.

Further cash generation would come from a reduction in financing costs with the company expecting €200 million in savings to the end of 2020. Overall, HeidelbergCement said it intended to reduce its leverage to below 2.0x and/or net debt to below €7 billion in order to achieve a BBB/Baa2 credit rating.

Read the article online at: https://www.worldcement.com/europe-cis/12062018/heidelbergcement-to-focus-on-free-cash-flow-generation/