Buzzi Unicem reported a fall in cement sales in the USA in 2016 on the back of slowing construction investment and weakness in the key Texan market. Demand for building products has been hit in the Lone Star state by the decline in oil prices, which has also reduced demand for oil-well cement.
For the full year, the company reported cement sales down 1.7% in the US with “more pronounced weakness in Texas, particularly around Houston.” Meanwhile, ready-mixed concrete output – a business mainly present in Texas – was down 9.8% on the previous year. Overall, construction investment growth in the USA slowed to 2.7% for the year.
The weakness in demand was, however, offset by favourable higher sales prices and the dollar exchange rate, the company said. As a result, net sales were up slightly at €1.12 billion – a rise of 0.8% on the previous year.
South of the border in Mexico, cement sales from Buzzi Unicem’s associate, Corporacion Moctezuma, slightly exceeded the high volumes of 2015, while strengthening prices for both cement and ready-mixed concrete helped to boost peso-denominated sales revenues.
Depreciation of the peso against the euro saw euro-denominated sales revenues actually fall by 2.7% for the year, however, to €609 million (based on 100% of Moctezuma’s sales). With a constant exchange rate, revenues would been 14.2% higher. Buzzi Unicem owns Moctezuma as a 50:50 joint venture with Spain’s Cementos Molins.
Read the article online at: https://www.worldcement.com/the-americas/14022017/buzzi-unicems-2016-north-american-results/