HeidelbergCement upbeat on 2017 outlook amid key-market strength, Italcementi gains

Completion of a $4 billion merger involving Essroc Cement Corp. and sister Italcementi S.p.A. businesses, improved financials and credit ratings, plus declining energy costs, support especially positive investor guidance for the parent company of Lehigh Hanson, Inc. “2016 was an exceptional year,” affirms HeidelbergCement AG Chairman Dr. Bernd Scheifele. “With the successful takeover of Italcementi, we have accelerated our growth and are now in an excellent strategic position.”

HeidelbergCement will apply Competence Center Readymix principles to Hanson and sister concrete operations across the globe.

In 2017, the producer will institute the enterprise-wide “Competence Center Readymix” (CCR), optimizing logistics and concrete mix designs with an eye toward $130 million in savings through 2019. CCR follows 2015 and 2016 continuous improvement programs covering cement and aggregate, respectively, each executed with a goal comparable to or exceeding the CCR target over a three-year window.

“Operationally, we concentrate on five areas: an increase in customer satisfaction, high operating leverage, cost leadership, vertical integration, and optimized geographical positioning. As a result, we will increase our efficiency and the satisfaction of our customers, especially in the world’s rapidly growing metropolitan areas,” Dr. Scheifele observes.

 Shipments  2015 2016
 Cement (mt)  121,929  124,983
 Aggregates (mt)  278,452  287,405
 Ready-mixed (m3)  47,433  48,117
 Sales  $18.73 billion  $18.55 billion
 HeidelbergCement offered two years of financials to reflect the combination of heritage and Italcementi businesses.  

“We remain cautiously optimistic about 2017,” he continues. “While the overall outlook for the global economy is positive, the major macroeconomic and particularly geopolitical risks have increased. HeidelbergCement will benefit from the good and stable economic development in the USA, Canada, United Kingdom, Germany, northern European countries, and Australia. With the acquisition of Italcementi and its rapid integration, we have impressively demonstrated our high business potential and strong momentum.”