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Cimpor reports lower volumes in 1H17

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World Cement,

Cimpor, part of InterCement, reported volumes of 11.5 million t in 1H17, a fall of 2.7% on the previous year. Earnings were also down year-on-year at €166 million as non-recurring costs offset a rise in sales revenues – a result of higher average prices.

Volumes were weighed down by continuing poor market conditions in Brazil, Mozambique, and Egypt. This more than offset growth in Argentina and Paraguay, a market recovery in Portugal, and a strong performance in South Africa.

Cement consumption in Brazil was down 8.8% in 1H17, while a high overcapacity in the market also drew down prices. Cimpor saw its cement and clinker volumes fall 11% over the first six months of the year, while the company also registered asset impairments related to projects under development.

Next door, in Argentina, the story was much more positive, however, with Cimpor reporting earnings up 43% against last year. “The country appears to be initiating another healthy economic cycle [which] continued to favour cement volumes sold,” the company said in its interim report.

Paraguay also reported favourable results with volumes up 34%.

Overall, cement and clinker volumes from Cimpor’s Latin American businesses totalled 7.03 million t compared to 7.26 million t in 1H16. Portuguese volumes totalled 1.78 million t, a 16.6% increase on the previous year. In Africa, volumes were 2.65 million, compared to 3.10 million t last year.

CAPEX for the first six months totalled €88 million, an increase on the €76 million reported in 1H17. CAPEX focused on energy upgrade, environmental requirements, and real-estate acquisitions in Brazil related to Cimpor’s concrete business.

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