HeidelbergCement reported Thursday higher profit in its fourth quarter, despite a decline in revenues. Cement and Aggregates volume increased, while ready-mixed concrete volume were down.
Looking ahead, the German building materials company reported good start to the year and confirmed optimistic outlook for 2021. Demand is expected to develop positively in many markets.
In 2021, the company expects a slight increase in revenue and the result from current operations, both before exchange rate and consolidation effects. The company also projects a significant increase in return on invested capital or ROIC to above 8 percent.
The company aims to achieve a ROIC of clearly above 8 percent by 2025.
Dominik von Achten, Chairman of the Managing Board of HeidelbergCement, said, "We have made considerable progress in 2020 in terms of return on invested capital. This puts us on track to achieve our strategic medium-term target earlier than expected."
Further, HeidelbergCement said it is resuming its progressive dividend policy faster than expected following the positive business trend in 2020. For the past financial year, the Managing Board and Supervisory Board propose to the Annual General Meeting the distribution of a dividend of 2.20 euros, compared to previous year's 0.60 per share.
The dividend is to increase by 5 percent compared with the pre-corona year 2018.
For the fourth quarter, profit Group share increased 3 percent to 349 million euros from last year's 339 million euros.
Result from current operations went up 7 percent to 648 million euros from 603 million euros last year.
Result from current operations before depreciation and amortisation edged up 1 percent to 976 million euros from prior year's 968 million euros. On a like-for-like basis, the increase was 16 percent. Margin grew to 21.8 percent from 21.2 percent a year ago.
Group revenue decreased 3 percent to 4.47 billion euros from 4.58 billion euros last year due to corona-related decline in demand. On a like-for-like basis, the decline amounted to 1 percent.
Cement volume increased 2 percent to 31.4 million tonnes, and Aggregates volume grew 1 percent to 75 million tonnes, while ready-mixed concrete volume dropped 2 percent.
In Germany, HeidelbergCement shares were trading at 72.62 euros, up 0.50 percent.
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