HeidelbergCement makes progress with portfolio optimisation
Published by Lucy Stewardson,
HeidelbergCement has announced that has made good progress with the acceleration of its portfolio optimisation over the past weeks. In December 2018, the company closed the divestment of its 50% share in Ciment Québec and its minority participation in Syria. Additionally, close to the river Nile and within the Cairo metropolitan area, a former cement plant area has been auctioned, and the divestment of the Ukrainian business has been signed. Closing of the latter transactions is expected in 2019. Together, these divestments have a total value that exceeds €150 million. This will have a slightly positive effect on operating EBITDA in 2019, compared to 2018.
In summer 2018, at its Capital Markets Day the company announced its goal to reduce complexity and risk by disposing of non-core businesses, market positions with high risks, or those with limited growth potential and idle assts. The original target was to generate proceeds from disposals of between €1 billion and €1.5 billion in the three year period from 2018 to 2020. Alongside its 3Q18 earnings report, the company announced its intention to accelerate disposals and review further divestment potentials. This was with the goal to reach or even exceed the upper end of the target range set at the Capital Markets Day.
“We are delivering on our action plan and have accelerated our efforts to improve our portfolio and generate cash, in order to speed up deleveraging,” said Dr Scheifele, Chairman of the Managing Board of HeidelbergCement. “For 2018, we expect to realise about €500 million in disposal proceeds and we are well on our way to reaching our target of €1.5 billion by the end of 2020. We remain committed to improving shareholder value and maintaining a solid investment grade rating.”
HeidelbergCement is one of the world’s largest integrated manufacturers of building materials, with leading market positions in aggregates, cement, and ready-mixed concrete.
Read the article online at: https://www.worldcement.com/europe-cis/14012019/heidelbergcement-makes-progress-with-portfolio-optimisation/
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