- First-quarter 2022 consolidated sales of €789 million, up
+12.4% at constant scope and exchange rates
- Solid sales growth in all regions
- Higher selling prices, in line with the Group’s
expectations
- No impact from the conflict in Ukraine on the Group’s
activity in the first quarter of 2022
Regulatory News:
Vicat (Paris:VCT) :
Consolidated sales
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
France
271
255
+6.0%
+3.2%
Europe (excluding France)
82
87
-5.0%
+9.3%
Americas
181
142
+27.7%
+17.5%
Asia
112
100
+12.0%
+8.1%
Mediterranean
53
43
+23.6%
+68.0%
Africa
90
80
+12.4%
+11.9%
Total
789
707
+11.6%
+12.4%
Commenting on these figures, Guy Sidos, the Group’s
Chairman and CEO said: “Vicat’s first-quarter sales performance
reflects the dynamism of its markets despite a high basis of
comparison. Recent geopolitical trends did not have any direct
impact on the Group’s business levels during the first quarter, and
we recorded solid growth compared with the same period of 2021. All
the regions where we operate posted growth in their sales at
constant scope and exchange rates. In a global environment
providing little visibility in the short term, especially as
regards energy costs, we are executing our strategy to improve our
production performance, make greater use of secondary fuels and
implement a pricing policy tailored to this new environment in
pursuit of our operational, environmental and societal
targets.”
Disclaimer:
- In this press release, and unless indicated otherwise, all
changes are stated on a year-on-year basis (2022/2021), and at
constant scope and exchange rates.
- The alternative performance measures (APMs), such as “at
constant scope and exchange rates”, “operational sales”, “EBITDA”,
“EBIT”, “net debt”, “gearing” and “leverage” are defined in the
appendix to this press release.
- This press release may contain forward-looking statements. Such
forward-looking statements do not constitute forecasts regarding
results or any other performance indicator, but rather trends or
targets. These statements are by their nature subject to risks and
uncertainties as described in the Company’s Universal Registration
Document on its website (www.vicat.fr). These statements do not
reflect the future performance of the Company, which may differ
significantly. The Company does not undertake to provide updates of
these statements.
Further information about Vicat is available from its website
(www.vicat.fr).
-----------------------------------------------------------------------------------------------------------------------------------
A solid recovery took place in the construction sector back in
the first quarter of 2021, providing a high basis of comparison. In
parallel, as fighting broke out in Ukraine during the first quarter
of the year, the Group carefully monitored trends in demand across
all the regions in which it operates to make sure it responds as
rapidly and effectively as possible to this change in the
environment. The Group does not have any assets in Ukraine or
Russia, and no Group employees are directly involved in the current
conflict. Given the impact of the war on energy prices, the Group
is naturally adjusting its hedging policy and has taken major steps
to expand the use of alternative fuels in order to adapt to the new
environment.
In the first quarter of 2022, the Vicat Group’s
consolidated sales totalled €789 million, up +11.6% on a reported
basis and up +12.4% at constant scope and exchange rates compared
with the same period of 2021. This increase on a reported basis
reflects:
- A positive currency effect of over €+3 million given
depreciation in the euro against the US dollar, Brazilian real, and
Indian rupee, partially offset by further depreciation in the
Turkish lira;
- A negative scope effect of close to €-9 million resulting from
the sale of Créabéton in Switzerland, partly offset by acquisitions
in Concrete and Aggregates in France;
- And organic growth of +12.4%, with price increases recorded
during the quarter largely offsetting a slightly negative volume
effect.
1. Consolidated sales in the three months ended 31 March 2022
by geographical region
1.1. France
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
Sales
271
255
+6.0%
+3.2%
During the first quarter of 2022, the Group’s performance in
France moved higher, supported by a small improvement in demand
compared with 2021 despite an unfavourable basis of comparison.
- In the Cement business, operational sales rose +7.4% at
constant scope in the first quarter. Given the unfavourable basis
of comparison resulting from the French market’s dynamic
performance in the same period of last year, this increase reflects
a slight pick-up in demand and a sharp rise in selling prices at
the beginning of the year.
- The operational sales recorded by the Concrete & Aggregates
business rose +6.1% at constant scope. This performance reflects
further expansion in concrete and in aggregates, as well as a
significant improvement in selling prices during the quarter.
- In the Other Products & Services business, operational
sales advanced +7.7% at constant scope over the period. The Group
is expected to complete the capacity increase at the Auneau plant
in the Paris region, which specialises in building chemicals (Vicat
Industrial Products). This investment, which is expected to enter
service during the second quarter, will increase mortar production
capacity by 150 thousand tonnes p.a., helping to meet the strong
demand in the Paris market, as well as unlocking a significant
reduction in logistics costs.
1.2 Europe (excluding France)
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
Sales
82
87
-5.0%
+9.3%
Business trends in Europe (excluding France) were positive in
the first quarter of 2022, supported by favourable conditions. The
decline in sales on a reported basis reflects a scope effect
resulting from the sale of the Créabéton precast business in
Switzerland, which was finalised on 30 June 2021.
In Switzerland, the Group’s consolidated sales climbed
+7.7% at constant scope and exchange rates.
- In the Cement business, operational sales moved up +4.1% at
constant scope and exchange rates. This performance reflects stable
demand during the quarter and a solid increase in selling
prices.
- In the Concrete & Aggregates business, operational sales
moved up +3.7% at constant scope and exchange rates. Volumes
declined in concrete but moved sharply higher aggregates.
- In the Other Products & Services business, operational
sales rose by +5.8% at constant scope and exchange rates, supported
by a healthy level of deliveries in the rail sector and a
favourable product mix.
In Italy, consolidated sales grew by +35.6%. Business
trends and selling prices moved significantly higher throughout the
period.
1.3 Americas
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
Sales
181
142
+27.7%
+17.5%
In the United States and in Brazil, construction sector trends
remain dynamic, supported by higher selling prices.
In the United States, the macroeconomic and sector
environment remained favourable during the first quarter.
Consolidated sales rose +12.9% at constant scope and exchange
rates.
The construction of the new kiln line at the Ragland plant
(Alabama) made progress and is due to enter service in the next few
weeks. The new installation will help meet the strong market demand
by increasing the plant’s capacity, significantly reduce its
production costs and help to lower the Group’s carbon
emissions.
- In the Cement business, operational sales in the region grew
+18.4% at constant scope and exchange rates during the period,
reflecting the momentum of the construction market in the regions
in which the Group operates and the introduction of a substantial
price increase. It’s worth noting that, consecutively to a
regulatory evolution, demand for “blended” cement or “limestone
cement” is emerging. This major trend is likely to reduce by over
10% the proportion of clinker in the cement the Group delivers, to
increase cement production capacity and to cut production costs and
carbon emissions per tonne of cement produced.
- In the Concrete business, operational sales rose +8.2% at
constant scope and exchange rates as market conditions remained
positive, especially in the residential and commercial sectors.
Against this backdrop, selling prices moved significantly
higher.
In Brazil, consolidated sales totalled €52 million, up
+31.6% at constant scope and exchange rates. Against a backdrop of
rapid inflation despite higher interest rates, demand remains
strong in the Group’s markets, in line with the trends seen in
recent quarters.
- In the Cement business, operational sales were €41 million, an
increase of +25.6% at constant scope and exchange rates. In a
dynamic market environment, selling prices posted a significant
increase compared with the same period of 2021.
- In the Concrete & Aggregates business, operational sales
were €17 million, an increase of +53.9% at constant scope and
exchange rates, in line with the trends seen in the Cement
business. The steady improvement in market conditions was
accompanied by a rise in prices, both in concrete and in
aggregates.
1.4 Asia (India and Kazakhstan)
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
Sales
112
100
+12.0%
+8.1%
Business in India grew throughout the period, supported
by solid demand, especially in the government sector. In a
high-inflation environment, prices rose significantly, especially
at the end of the quarter. Overall, the Group posted consolidated
sales of €100 million in the first quarter of 2022, up +8.1% at
constant scope and exchange rates.
Consolidated sales in Kazakhstan came to €12 million, up
+7.9% at constant scope and exchange rates. This performance was
achieved through a significant increase in selling prices, which
largely offset a temporary decline in volumes delivered over the
winter period.
1.5 Mediterranean (Egypt and Turkey)
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
Sales
53
43
+23.6%
+68.0%
In the Mediterranean region, sales moved sharply higher in both
countries as a result of contrasting situations.
In Turkey, although the macroeconomic and sector
environment remains upbeat, the winter conditions significantly
affected demand during the first quarter without that representing
a change in trends. Overall, first-quarter 2022 consolidated sales
totalled €27 million (versus €28 million in the first quarter of
2021), up +67.9% at constant scope and exchange rates.
- In the Cement business, the far less favourable weather
conditions than in the first quarter of 2021 impacted business
trends. As a result, volumes delivered were much lower during the
period, even though demand remains solid. In a high-inflation
environment, significant price increases were introduced, which
offset the fall in deliveries to a large extent.As a result,
operational sales in the business climbed +47.2% at constant scope
and exchange rates.
- In the Concrete & Aggregates business, operational sales
rose +113.3% at constant scope and exchange rates. As in the Cement
business, tough weather conditions at the beginning of the year
dragged down concrete and aggregates deliveries during the quarter,
even though the impact of these reductions was very largely offset
by the significant rise in selling prices.
In Egypt, consolidated sales totalled €26 million, up
+68.3% at constant scope and exchange rates. Following the market
regulation agreement that entered force in July 2021 between the
Egyptian government and all producers, selling prices in the
domestic market continued to improve during the first quarter,
supported by a solid increase in demand.
1.6 Africa
(€ million)
First-quarter 2022
First-quarter 2021
Change (reported)
Change (at constant scope and
exchange rates)
Sales
90
80
+12.4%
+11.9%
In Africa, the Group continues to reap the benefit of a dynamic
sector environment despite the political crisis in Mali.
- In the Cement business, operational sales in the Africa region
grew +8.5% at constant scope and exchange rates, reflecting the
strong momentum of the markets in Senegal and Mauritania, which
offset the decline in Mali, where the market was disrupted by
policies restricting imports. Selling prices rose in both these
regions.
- In Senegal, the Aggregates business, supported by the gradual
resumption of major government construction projects, recorded
operational sales of €8 million, up +10.3% at constant scope and
exchange rates.
2. Changes in Vicat’s consolidated financial position at 31
March 2022
At 31 March 2022, the Group’s shareholders’ equity was €2,675
million, up from €2,458 million at 31 March 2021. The Group’s net
debt was €1,546 million, versus €1,270 million at 31 March 2021
given the significant increase in the working capital requirement
with the growth in sales and the impact of inflation on
inventories.
3. Recent events
3.1 Situation caused by the conflict in Ukraine:
The Vicat group does not have any industrial or commercial
operations in Ukraine or Russia. As a result, no Group assets and
no employees have been directly impacted by the current conflict.
As things stand, there has been no impact on the Group’s business.
That said, the conflict is likely to affect growth in Europe and
worldwide, and thus the Group’s operations in potentially exposed
countries.
3.2 Situation in Egypt:
In Egypt, the fierce competition seen for several years has
improved since an industry-wide agreement was reached between the
authorities and cement sector players. As a result of this
agreement, which has temporarily curbed utilisation rates, prices
have recovered sharply, bringing EBITDA back to breakeven point in
the second half of 2021 and early 2022.
In addition, the freeze put on Sinai Cement’s capital increase
since 2018 prompted the Group to launch an arbitration procedure
against the Egyptian government. Negotiations led to the signature
on 21 March of an agreement, enabling the capital increase to go
ahead and confirming Vicat’s rights to hold and to consolidate on
its majority ownership. The Group has thus consolidated its
shareholding through a simplified public tender offer, raising its
equity interest from 56.2% at 31 December 2021 to 67.2% at 30 April
2022.
3.3 Update on energy costs:
Energy costs totalled around €400 million in 2021, 57% of which
relate to the use of fuel. Of these fuel sources, coal accounted
for around 46%, alternative fuels for 26%, petcoke 24% and gas
around 3%.
The Group’s hedging policy provides a degree of visibility on
its energy costs over the short term (around six to nine
months).
Given this policy, the Group estimates that at current energy
prices it would need to raise its prices by +15% in the Cement
activity over the full year to fully cover the increase in its
energy costs. As things stand at 31 March 2022, further price hikes
are thus needed in France, Switzerland, Senegal and Brazil to meet
this objective, all other factors remaining equal. Accordingly, the
Group remains focused and confident of its ability in the current
environment to introduce the requisite increases in selling prices
to cover the inflation in its energy costs, situation
permitting.
Naturally, this estimate is likely to be reviewed based on:
- Energy price trends in its local markets and, more generally,
the worldwide market
- The Group’s conservative hedging policy
- Arbitrage opportunities within its mix of conventional
fuels
- And, lastly, by increasing the proportion of alternative fuels
used to replace its conventional fuels.
4. Outlook 2022
In 2022, the Group anticipates a strong increase in its sales
underpinned by an increase in its activity levels and a sharp
progression in selling prices. EBITDA generated by the Group in
2022 is likely to grow, but not by as much as in 2021. In light of
these elements, the Group expects erosion in its EBITDA margin in
2022.
In 2022, the Group will keep up its investment drive, focusing
chiefly on:
- finalisation of construction work at the new Ragland kiln in
the United States, which is expected to start up in May 2022;
- start of construction work on the new kiln (Kiln 6) in
Senegal;
- the ramp-up in projects to meet carbon footprint reduction
targets;
- a drive to incrementally boost capacity at production
facilities in India and to invest in new terminals to expand its
market and lower logistics costs.
Accordingly, capital expenditure is expected to be higher than
in 2021 at around €400 million, including 130 million in
"maintenance" investments and 270 million in "strategic"
investments. The Group reserves the right to adjust its investment
plans, by reducing, if necessary, the proportion of its “growth”
capex, to match the shifting trends in its markets and its
cash-flow generation.
The Group is issuing the following elements of appreciation
about the performance expected in the various countries in which it
operates. It wishes to make clear that these trends are highly
dependent on the latest developments in the pandemic and on the
conflict in Ukraine and on their impact on each of them:
- In France, activity levels are expected to remain on a growth
trajectory throughout the year, supported by a macroeconomic
environment that should be favourable for the construction sector.
As a result, the Group expects its volumes to rise slightly and its
prices to rise markedly to offset the impact of higher energy
costs, especially electricity;
- In Switzerland, the Cement and the Concrete & Aggregates
businesses should reap the benefit of upbeat conditions in the
construction sector. As in France, the Group expects a sharp
increase in electricity costs compensated by higher selling
prices.
- In the United States, both volumes and selling prices are
expected to continue increasing. The impact of the economic
stimulus plan being rolled by the US administration is likely to
make itself felt gradually from the second half of this year. In
this market, the Group is expected to reap the benefit of the
commissioning of the new kiln of the Ragland plant from the end of
the first half;
- In Brazil, business and profitability levels in 2021 have set a
high basis of comparison in a market in which trends are expected
to remain nonetheless favourable. As a result, the Group expects a
slight increase in business levels over the year as a whole,
supported by the continued rise in prices;
- In India, the macroeconomic and sector environment is expected
to remain favourable. With prices remaining highly volatile, the
strong rise in energy costs should only be partially
compensated;
- In Kazakhstan, 2021 performance levels set a high basis of
comparison. While the market environment is expected to remain
supportive, this will remain contingent on developments in the
political and social situation;
- In Turkey, the situation is expected to keep improving
gradually in 2022, subject to trends in the Turkish lira and
interest rates. The price increase should help offset the rise in
energy costs;
- In Egypt, amid a gradually improving industry environment, the
Group’s performances over the year remains subject to the
maintaining of the measures implemented by the government to
restore a healthier market environment.
- In West Africa, trends in Cement are expected to remain
dynamic, with support from a favourable sector environment. To
note, the currently political crisis in Mali is concerning and may
dampen activity levels in this country. The Aggregates business in
Senegal is likely to continue its recovery.
Conference call
To accompany the publication of its first-quarter 2022 sales,
the Vicat Group is organising a conference call in English that
will take place on 5 May 2022 at 3pm Paris time (2pm London
time and 9am New York time).
To take part in the conference call live, dial in on one of the
following numbers:
France: +33 (0)1 70 37 71 66 United Kingdom: +44 (0)33 0551 0200
USA: +1 212 999 6659
An audio feed of the conference call, together with the
presentation, can be livestreamed from the Vicat website or
accessed by clicking here. The replay of the conference call will
be immediately available for streaming via the Vicat website and by
clicking here.
Next event:
First-half 2022 results on 27 July 2022 after the close.
About Vicat
The Vicat Group has close to 9,500 employees working in three
core divisions, Cement, Concrete & Aggregates and Other
Products & Services, which generated consolidated sales of
€3.123 billion in 2021. The Group operates in twelve countries:
France, Switzerland, Italy, the United States, Turkey, Egypt,
Senegal, Mali, Mauritania, Kazakhstan, India and Brazil. Vicat, a
family-owned group, is the heir to an industrial tradition dating
back to 1817, when Louis Vicat invented artificial cement. Founded
in 1853, the Vicat Group now operates three core lines of business:
Cement, Ready-Mixed Concrete and Aggregates, as well as related
activities.
Vicat group – Financial data – Appendix
Definition of alternative performance measures
(APMs):
- Performanceat constant scope and exchange rates is used
to determine the organic growth trend in P&L items between two
periods and to compare them by eliminating the impact of exchange
rate fluctuations and changes in the scope of consolidation. It is
calculated by applying exchange rates and the scope of
consolidation from the prior period to figures for the current
period.
- A geographical (or a business) segment’s operational
sales are the sales posted by the geographical (or business)
segment in question less intra-region (or intra-segment)
sales.
- Value-added: value of production less consumption of
materials used in the production process.
- Gross operating income: value-added, less staff costs,
taxes and duties (other than on income and deferred taxes) plus
operating subsidies.
- EBITDA (earnings before interest, tax, depreciation and
amortisation): sum of gross operating income and other income and
expenses on ongoing business.
- EBIT: (earnings before interest and tax): EBITDA less
net depreciation, amortisation, additions to provisions and
impairment losses on ongoing business.
- Cash flow: net income before net non-cash expenses (i.e.
predominantly depreciation, amortisation, additions to provisions
and impairment losses, deferred taxes, gains and losses on
disposals and fair value adjustments).
- Free cash flow: net operating cash flow after deducting
capital expenditure net of disposals.
- Net debt represents gross debt (consisting of the
outstanding amount of borrowings from investors and credit
institutions, residual financial liabilities under finance leases,
any other borrowings and financial liabilities excluding options to
sell and bank overdrafts), net of cash and cash equivalents,
including remeasured hedging derivatives and debt.
- Gearing is a ratio reflecting a company’s financial
structure calculated as net debt/consolidated equity.
- Leverage is a ratio based on a company’s profitability,
which is calculated as net debt/consolidated EBITDA.
Breakdown of first-quarter 2022 sales by business
Cement
(€ million)
First-quarter 2022
First-quarter 2021
Change
(reported)
Change (at constant scope and
exchange rates)
Volume (thousands of tonnes)
6,228
6,535
-4.7%
Operational sales
499
431
+15.8%
+15.0%
Consolidated sales
429
374
+14.4%
+13.1%
Concrete &
Aggregates
(€ million)
First-quarter 2022
First-quarter 2021
Change
(reported)
Change (at constant scope and
exchange rates)
Concrete volume (thousands of m3)
2,190
2,232
-1.9%
Aggregates volume (thousands of
tonnes)
5,403
5,288
+2.2%
Operational sales
297
258
+15.2%
+13.7%
Consolidated sales
290
250
+16.0%
+14.1%
Other Products &
Services
(€ million)
First-quarter 2022
First-quarter 2021
Change
(reported)
Change (at constant scope and
exchange rates)
Operational sales
102
110
-7.2%
+8.3%
Consolidated sales
70
82
-14.4%
+4.5%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220504005921/en/
Investor relations contact: Stéphane Bisseuil : Tél. + 33
(0)1 58 86 86 05 stephane.bisseuil@vicat.fr
Press contacts: Karine Boistelle-Adnet Tél. +33 (0)4 74
27 58 04 karine.boistelleadnet@vicat.fr
Vicat (EU:VCT)
Graphique Historique de l'Action
De Sept 2024 à Oct 2024
Vicat (EU:VCT)
Graphique Historique de l'Action
De Oct 2023 à Oct 2024
