8 May 2008

Good start in the first quarter of 2008

  • Turnover in the first quarter exceeds EUR 3 billion
  • Significant double-digit growth in operating income, even on a like-for-like basis
  • Decline in North America more than compensated for by Europe and Asia
  • Noticeable increases in turnover and results confidently expected for 2008

Overview January – March 2008

January - March
Operating income before depreciation (OIBD)253385
Operating income142190
Additional ordinary result3719
Results from participations176
Earnings before interest and income taxes (EBIT)196214
Profit before tax14415
Net income from continuing operations10411
Net income from discontinued operations151,276
Profit for the financial year1191,287
Group share profit1091,264

* Figures have been adjusted following the presentation of maxit Group as discontinued operation (IFRS 5) and are therefore not comparable with those presented in 2007.

Considerable rise in key figures

Despite the effects of the crisis on the property and financial markets in the US, HeidelbergCement has had a good start in the first quarter. Cement and clinker sales volumes of the Group rose by 9.9% to 19.6 million tonnes (previous year: 17.9). Excluding consolidation effects, the increase amounted to 4.1%. The growth was strongest in the Europe Group area, followed by Asia-Australia-Africa. Deliveries of aggregates almost quadrupled, reaching 61.0 million tonnes (previous year: 16.4) and ready-mixed concrete sales volumes increased by 89.6% to 10.0 million m3 (previous year: 5.3). Even excluding the Hanson activities, the sales volumes noticeably improved in both operating lines.

“In the first few months of 2008, we were able to achieve a considerable rise in our key figures as a result of organic growth and a strong global market position”, said Dr. Bernd Scheifele, Chairman of the Managing Board of HeidelbergCement at the presentation of the figures for the first quarter of 2008 in the presence of 260 shareholders at the Group’s Annual General Meeting on 8 May 2008 in Leimen, Germany. Group turnover rose by 71.8% in the first quarter to EUR 3,062 million (previous year: 1,783). This was due to the inclusion of Hanson in particular, but the countries of Eastern Europe and Central Asia as well as Germany, the Benelux countries, Sweden, Asia, Ghana and Turkey also contributed to this growth. Excluding exchange rate and consolidation effects, turnover increased by 10.6%. Operating income before depreciation (OIBD) rose by 52.3% to EUR 385 million (previous year: 253). Operating income rose by 33.1% to EUR 190 million (previous year: 142).

The decline of EUR 10.9 million in results from participations to EUR 5.7 million (previous year: 16.6) results essentially from the sale of the French participation Vicat S.A. in June 2007. The decrease of EUR 146.6 million in financial results to EUR -199.1 million (previous year: -52.5) is mainly due to the financing of the Hanson acquisition in August 2007.

The increase in financing costs and the decline in results from participations were not completely compensated for by the improvement in operating income, which resulted in a reduction of EUR 128.8 million in profit before tax from continuing operations, bringing the total to EUR 14.9 million (previous year: 143.7). Taxes on income fell accordingly by EUR 35.3 million to EUR 4.1 million (previous year: 39.4). Net income from continuing operations amounted to EUR 10.7 million (previous year: 104.3).

In August 2007, HeidelbergCement signed and agreement for the sale of maxit Group with the French building materials manufacturer Saint Gobain. The transaction with a value of EUR 2,125 million was completed on 13 March 2008 with the approval of the cartel authorities. The resulting book profit of EUR 1,279.3 million is included in the net income from discontinued operations.

Overall, the profit for the financial year increased to EUR 1,287.1 million (previous year: 119.1). Consequently, the Group share of profit rose to EUR 1,264.4 million (previous year: 108.9).

Refinancing successfully continued

In January, HeidelbergCement issued a four-year Eurobond with a volume of EUR 1 billion. In addition, HeidelbergCement received EUR 512.5 million in February from a cash capital increase; VEM Vermögensverwaltung GmbH, which belongs to members of the Merckle family, subscribed for 5 million new shares. The proceeds from these measures and from the sale of maxit Group of EUR 2,125 million were used to repay the syndicated loan taken out in connection with the Hanson acquisition.

Noticeable growth confidently expected for 2008

The broadened geographical diversification improves the Group's fundamental strengths. “We expect noticeable increases in turnover and results as a result of the full-year inclusion of Hanson and solid operational development”, stated the Chairman of the Managing Board, Dr. Bernd Scheifele. The integration of Hanson and the associated organisational changes are proceeding as planned. The completion of the integration process by mid-2008 and the first effects of converting potential synergies will contribute to the positive development of results.

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Andreas Schaller

Group Spokesman, Director Group Communication & Investor Relations
+49 6221 481 13249
+49 6221 481 13217
HeidelbergCement AG
Berliner Straße 6
69120 Heidelberg