Solid performance in the US and Europe drive sales and earnings growth

With two very strong quarters in 2023, Group’s consolidated sales for H1 2023 surpassed the €1.2 billionn level, reaching €1,229 million, increased by 18.7% versus the first half of 2022. This strong top-line performance was achieved thanks to increased domestic demand levels across their products in their main markets. Price increases implemented in 2022 across regions, coupled with price increases in selective markets at the beginning of 2023 – targeted to mitigate the continuously high inflation level and restore margins- supported the positive revenue trajectory.

EBITDA increased to €241.2 million compared with €136.3 million in H1 2022, an increase of 77%, with profitability margins expanding, as investments implemented during the last two years are progressively improving cost performance. The energy mix improves with higher use of alternative fuels and the energy cost levels soften, still however being at higher than the pre-crisis levels. Group EBITDA over the past 12-month period (July 2022-June 2023) reached €436 million. Net profit after taxes and minority interests (NPAT) in the first six months of 2023 more than doubled to €110.9 million compared to the €45.2 million of the first six months of 2022. Trends and economic conditions in the regions we operate in the US remain favourable to construction, resulting in improved demand and pricing levels. In Greece, demand continues to rise, while market trends in Southeastern Europe remain positive year-to-date. Domestic demand has been increasing significantly in Turkey, while volumes have been softening in Egypt. Volume trends across all main product lines testify to healthy demand, as domestic cement sales volumes increased by 3%, aggregates and ready-mix increased by 6% and 3% respectively, YoY.

Chairman of Group Executive Committee, Marcel Cobuz reported that “An excellent first half of the year with strong pricing over costs and increased percentage of low carbon sales reaching 25% in infrastructure and building projects across the Group. We are well on track for a record year of growth and an accelerated roadmap of decarbonisation and digitalisation”.

Economic growth, internal migration, strong employment levels and payroll growth across our specific markets along the East Coast, underpin a solid demand in the housing market and non-residential development while strong public investment are spurring public infrastructure. Housing inventories remain low in our key markets driven by increased demand and tight supply, and backlogs for heavy non-residential have been strong. Simultaneously, favourable trends from onshoring, warehousing, and data centres are present.

On the public side, the Departments of Transportation have started putting the funds from the “Infrastructure Investments & Jobs Act” to work, with transportation contract awards accelerating, reaching record high value of contract awards, resulting in incremental demand for aggregates, cement, and downstream products and increased profitability. The latter is not only the result of a robust pricing cycle but more critically, the result of operational efficiencies deployed strategically through investments in digitalisation, decarbonisation and supply chain across the Group’s US footprint. In July, the US$37 million milestone project of the 67,500 tons storage in our import terminal in Tampa, Florida has been commissioned, enhancing its capabilities for distributing and importing larger quantities of cement and cementitious materials such as fly ash, slag, as well as aggregates. The second such dome investment of another US$36 million in Norfolk, Virginia is due to come on stream in December, complementing and expanding the Group’s Mid-Atlantic supply network.

Sales in the USA recorded a 24.5% increase to €735.5 million during the first six months of 2023 (23.3% increase in US$ terms), while EBITDA reached €135.5 million, a 115.3% hike vs the H1 2022 EBITDA of €63.0 million.

Read the article online at: https://www.worldcement.com/europe-cis/28072023/solid-performance-in-the-us-and-europe-drive-sales-and-earnings-growth/