In a speech to shareholders at HeidelbergCement’s Annual General Meeting (AGM) earlier this week, Bernd Scheifele, Chairman of the Managing Board, offered a look back at the company’s achievements in 2017.
One year after the acquisition of Italcementi, the company has achieved new record figures for sales volumes, revenue, result from current operations, and free cash flow. Despite a challenging environment with significantly increased energy costs and pressure on margins in emerging countries, HeidelbergCement reached its targets and increased revenue and result from current operations on a comparable basis as forecast. This was attributed to its successful integration of Italcementi and from exceeding the synergy target planned for the end of 2018 already at the end of 2017.
The synergy target was once again increased: the company expects that annual run-rate synergies of €550 million should now be realised by the end of 2018 compared with €470 million planned before. HeidelbergCement further increased its free cash flow in 2017, partly due to a further reduction in financing costs. In addition, as in the previous year, the company has earned a premium on its cost of capital. The strategic priorities - shareholder returns and continuous growth - are clearly reflected in the considerably increased dividend.
Scheifele also reported on the results and developments in 1Q18, and confirmed the outlook for the remainder of the year given at the publication of the 2017 annual results in March 2018. “Despite the bad weather conditions, HeidelbergCement generated a profit in the seasonally weak first quarter," explained Scheifele. "We are on track to meet our strategic goals: to achieve continuous growth, create long-term value for our shareholders, and safeguard high-quality jobs."
The AGM also approved the proposal of the administration to increase the dividend by 19% to €1.90 with a substantial majority of 99.96%. “With the strong increase in dividend payment, we consistently implement our progressive dividend strategy and share our successful business development with our shareholders,” explained Scheifele. “For the first time since the financial crisis, the dividend payments exceed the net interest expenses.” In addition, the AGM elected Marget Suckale as representative of the shareholders with a significant majority of 99.97%.
Of the company’s €595.2 million in subscribed share capital, 72.79% were represented.
Read the article online at: https://www.worldcement.com/special-reports/11052018/heildelbergcement-holds-agm/