HeidelbergCement AG - Tough Q3 prompts new action plan

Davy Research
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HeidelbergCement’s (HEI) results show the real damage caused by weather, but primarily energy costs, over the summer. EBITDA margins fell sharply as the group struggled to offset. HEI has launched a range of actions in response, including accelerating disposals, new SG&A savings of €200m and limiting growth capex. A buy-back will be considered next year, but it seems a long way off given elevated debt levels. The new measures are a positive surprise but perhaps not enough to counter the extent of the negative margin trend revealed in the results.