Germany's HeidelbergCement posted a rise in second-quarter profits on Monday, boosted by the disposal of its stake in French building materials group Vicat.
HeidelbergCement, which is buying British aggregates specialist Hanson for 8 billion pounds ($16.29 billion), said profit before tax in the quarter was 1.375 billion euros ($1.89 billion), up from 535 million euros in the same period last year.
Analysts from DZ Bank and LBBW said the figures had narrowly missed their expectations despite coming in much higher than the previous year, while WestLB said the operating performance was ahead of its forecasts in the first half and the firm was "on track for further expansion".
Shares in HeidelbergCement, which have risen about 12 percent in the past 12 months, edged 0.1 percent lower to stand at 107.12 euros by 1055 GMT, while the German mid-cap index was down 0.4 percent.
The world's fourth-largest cement maker, which competes with Lafarge and Switzerland's Holcim, said it was confident of achieving a significant improvement in turnover and results in 2007.
"We want to continue the positive development in operating income margin," Chief Executive Bernd Scheifele told a conference call. The company improved its operating profitability by 1.9 percentage points to 15 percent of sales in the first half.
While cement and clinker sales volumes in the first half of 2007 were up more than 21 percent in the Asia-Africa-Mediterranean Basin region, business in North America weakened slightly. "No improvement in the US residential markets is forecast in H2, where high risks remain," said Citigroup in a note.
HeidelbergCement said it was on track to complete its take-over of Hanson in August or September. The acquisition will mark the biggest take-over in the sector and will create the global number two in construction materials, challenging top-ranked Saint Gobain.
It said a credit facility to help finance the acquisition had been syndicated to 46 banks. It also raised around 527 million euros via a capital increase. The firm also said it would decide whether to float or sell its clay and mortar unit Maxit in the second half of the year, though Scheifele said in the conference call the company currently favoured the option to sell. Maxit posted a 15.7 percent increase in first-half sales to 650 million euros and a 46 percent gain in operating income to 67 million.
Comments
Comments are closed.