Contents
Results and significant events for the year 27
The international economy and industry trends 30
Business and financial performance in 2008 31
Performance by country and business 44
Energy project 57
Dealings with related parties 58
Information systems 60
Sustainable development 60
Engineering, technical assistance, research and development 64
Innovation 66
E-business 66
Disputes and pending proceedings 68
Significant post balance-sheet events 69
Outlook 70
Annual Report
Directors’ report
General information
Financial statements 72 Notes 76 Annexes 144Representation pursuant to art. 154-bis paragraph 5 TUF 154
Report of the Independent Auditors 155
Consolidated financial statements
Italcementi S.p.A. Directors, Officers and Auditors 6
Professional profiles of the members of the Board of Directors and Board of Statutory Auditors 7
Call of Shareholders' Meeting 14
Italcementi Group in the world 16
Highlights 18
Italcementi S.p.A. on the Stock Exchange 19
Presentation
Financial statements 158
Report of the Independent Auditors 162
Summary of resolutions 163
Parent company financial statements
Corporate Governance 166
Annexes 206
Representation pursuant to art. 154-bis paragraph 5 TUF 212
Italcementi S.p.A.
Via G. Camozzi, 124 - 24121 Bergamo - Italy
Share Capital € 282,548,942
Bergamo Companies Register
Company subject to management control
Italcementi S.p.A.
Via G. Camozzi, 124 - 24121 Bergamo - Italy
Share Capital € 282,548,942
Bergamo Companies Register
experienced a sharp slowdown. The repercussions of this scenario on the performance of
the Italcementi Group were reflected in a larger than expected downturn in its annual
results.
The current situation on the markets and in the world economy in general has been
described in many quarters as the worst since 1929. At that time our company had already
been active for more than fifty years: it successfully overcame the crisis by focusing on its
industrial and financial fundamentals. Today, our industrial operations are following the
example of that earlier experience and taking all the necessary steps to lower the
break-even point. Measures and sacrifices designed on one hand to cut fixed costs, on the other
to redouble efforts to raise efficiency and effectiveness in every corporate activity and
process.
As we said, this is not a new approach for Italcementi. A useful reminder appears in the
comments of chairman Cesare Pesenti in the 1930 annual report:
.
An equally important factor is a strategy to ensure the solidity of the Group’s financial and
equity structure, the cornerstone for a long-term approach in an industry subject to
significant cyclical swings. Returning to 1931, Cesare Pesenti wrote that the approach
adopted by the company
.
The undertakings and sacrifices introduced then lie at the heart of our entrepreneurial and
cultural heritage and are the values on which we have built a Group that intends to be a
long-term sustainable player.
Today, we have already identified and planned a series of measures to respond to the
current difficulties, and we expect to see the first benefits before the end of the current year.
With 2009 likely to be a very difficult year given a crisis that has assumed a systemic
dimension, we shall be working to make sure that, despite the difficulties we face and in
parallel with constant attention to our financial and capital structure, we are in a position to
respond to any opportunities for further consolidation and growth.
Carlo Pesenti
Chief Executive Officer
Giampiero Pesenti
Chairman
Italcementi S.p.A. Directors, Officers and Auditors
Antonio Catani
Honorary Chairman
Board of directors
(Term ends on approval of financial statements at 12.31.2009)
Giampiero Pesenti
1Chairman
Pierfranco Barabani
1Executive Deputy Chairman
Carlo Pesenti
1-2Chief Executive Officer-CEO
Alberto Bombassei
6Alberto Clô
3-5-6Federico Falck
5-6Pietro Ferrero
6Danilo Gambirasi
Karl Janjöri
4-6Italo Lucchini
4Emma Marcegaglia
6Sebastiano Mazzoleni
Yves René Nanot
1Marco Piccinini
Ettore Rossi
6-7Attilio Rota
1-5-6Carlo Secchi
5-6Emilio Zanetti
4-6Paolo Santinoli
8Secretary to the Board
Board of statutory auditors
(Term ends on approval of financial statements at 12.31.2008)
Acting auditors
Maria Martellini
Chairman
Claudio De Re
Claudio Cavalli
Substitute auditors
Eugenio Mercorio
Dino Fumagalli
7Pietro Curcio
Giovanni Ferrario
Chief Operating Officer - COO
Carlo Bianchini
Manager in charge of preparing
the company’s financial reports
Reconta Ernst & Young S.p.A.
Independent Auditors
1 Member of the Executive Committee
2 Executive Director responsible for supervising the internal control system 3 Lead independent director
4 Member of the Remuneration Committee 5 Member of the Internal Control Committee
6 Independent Director (in accordance with the Voluntary Code of Conduct) 7 Member of the Compliance Committee
Board of Directors
Giampiero Pesenti
Degree in mechanical engineering – Milan Polytechnic.
1958, began working in the Technical Division of Italcementi S.p.A., the family firm
established in 1864.
1983, appointed Chief Operating Officer; 1984, Chief Executive Officer; since 2004
Chairman of Italcementi S.p.A.
1984, appointed Chairman-Chief Executive Officer of Italmobiliare S.p.A., the holding
company that controls Italcementi S.p.A., the Sirap Gema group and other finance and
banking companies.
Pierfranco Barabani
Degree in civil engineering – Milan Polytechnic.
Worked as an independent professional until 1970, when he joined Italcementi S.p.A.,
holding a variety of posts: Assistant to the Chief Operating Officer, Property Manager,
Corporate General Affairs Manager.
1993, appointed Chief Operating Officer and held the post until September 1999.
Carlo Pesenti
Degree in mechanical engineering – Milan Polytechnic.
Master in economics & management – Bocconi University, Milan.
After joining the Italcementi Group, gained significant experience in a variety of Group
production units and especially in the Corporate Finance, Administration & Control Division.
Having held the post of Joint Chief Operating Officer, in May 2004 he was appointed
Italcementi Chief Executive Officer.
Chief Operating Officer of Italmobiliare.
Alberto Bombassei
Honorary degree in mechanical engineering.
In 1961 he joined his father and uncle to found the Brembo company, of which he became
Chief Operating Officer in 1976. In 1984 he was appointed Chief Executive Officer, and in
1993 also became Chairman.
Professional profiles of the members
From June 2001 to May 2004 he was President of Federmeccanica.
Currently Chairman of Brembo S.p.A., a market leader in the design and production of
high-performance brakes for cars, motorbikes, commercial vehicles, as well as for race
competitions and the spare parts market.
He is also Vice President of Confindustria for Industrial Relations and Social Affairs
.
Alberto Clô
Degree in political science – Bologna University.
Full professor of Industrial Economics and Public Services Economics at Bologna
University.
Author of numerous books, essays and articles on industrial economics and energy,
founder and since 1984 editor of the “Energia” review.
Minister of Industry and Foreign Trade in the Dini Government (1995-96).
Federico Falck
Degree in mechanical engineering – Milan Polytechnic.
Began his career in 1977 at the Acciaierie e Ferriere Lombarde Falck S.p.A. (now “Falck
S.p.A.”); after internships in a number of US steel companies, he worked mainly in
production and procurements for steel operations; Procurements Manager and Chief
Operating Officer for many years.
Currently Chairman of the Board of Directors of Falck S.p.A. and Chairman of the Board of
Directors of ACTELIOS S.p.A., a Falck Group company listed on the Milan Stock Exchange
(STAR segment).
Pietro Ferrero
Degree in biology – Turin University.
1985, joined Ferrero at the Allendorf plant and then moved to the Alba facility to work on
technical and production questions.
1992, appointed Operations Manager in the European Division of the Ferrero Group.
Currently Chairman of Ferrero S.p.A. and Chief Executive Officer of Ferrero International
S.A.
Danilo Gambirasi
Science high-school degree.
Italcementi S.p.A., first as Deputy Corporate Procurements Manager, later as International
Relations & Fuel Procurement Manager until his retirement in 1997.
Karl Janjori
Increasingly senior posts at Union Bank of Switzerland until his appointment in 1991 as
Executive Vice President and Member of the Group Executive Board.
Other posts:
Ɣ
Director since 1987 and Chairman from 1997 to 2005 of Banco di Lugano;
Ɣ
Director since 1986 and Chairman from 1999 to 2004 of Forbo Holding A.G.;
Ɣ
Director from 1981 to 2000 of EMS Chemie Holding A.G.
Italo Lucchini
Degree in economics & commerce – Bocconi University, Milan.
Assistant lecturer at Bocconi University and non-tenured lecturer at Bergamo University.
Now works as a public accountant with a successful practice in Bergamo.
Supervisory Director at Unione di Banche Italiane S.c.p.a. and Chairman of the Board of
Statutory Auditors of BMW Italia S.p.A. and its subsidiaries.
Emma Marcegaglia
Degree in business economics – Bocconi University, Milan.
Master in business administration, New York University.
Previous posts:
Ɣ
Director, Finecobank S.p.A.;
Ɣ
Confindustria Vice President for Europe, from 2000 to 2002;
Ɣ
National President Young Entrepreneurs, Confindustria, from 1996 to 2000;
Ɣ
National Vice President Young Entrepreneurs, Confindustria, from 1994 to 1996;
Ɣ
President Young Entrepreneurs for Europe (YES) since 1997.
Currently Chief Executive Officer of Marcegaglia S.p.A., a leading steel processing
company, and of other Group companies, some of which operate in tourism.
From May 2004 to May 2008, Vice President of Confindustria with responsibility for
infrastructure, energy, transport and the environment, and representative for Italy in the
European Commission’s high-level Group on Energy, Competitiveness & Environment.
Since May 2008 President of Confindustria.
Sebastiano Mazzoleni
Degree in geology – Milan State University.
Master in Business Administration (MBA) – Bocconi University, Milan.
Began his professional career in 1996 with CTG S.p.A. as a research geologist with
responsibility for assessing raw material reserves for cement production, coordinating work
groups in Italy, France, Spain and Thailand.
2000, moved to Italcementi S.p.A. as Project Manager in the Marketing Division, with joint
responsibility for drawing up new product marketing plans and benchmark analyses for the
development of competitive positioning models.
2003, involved in the creation of the new Group New Product Marketing Division, where he
is currently responsible for innovation management in the USA, Greece, Bulgaria, Turkey,
Egypt, Thailand, Kazakhstan and India. He is also Group manager of the new project for
enhancement of recoverable resources.
Yves René Nanot
Degree in engineering – Paris.
Master and Ph.D in Business Administration from University of California, Los Angeles.
Held a variety of posts at Dupont de Nemours and then in the Total Group; 1993, joined
Ciments Français where he is currently Chairman and Chief Operating Officer.
Marco Piccinini
Attended science high school and the faculty of architecture. Subsequently studied
"International Negotiating Techniques” at the Institut des Hautes Etudes Internationales in
Geneva.
Director of a number of listed and unlisted companies active in banking, insurance,
automobiles, luxury goods, services and tourism.
Ettore Rossi
Degree in economics & commerce – Catholic University, Milan.
Worked in the Italcementi company from September 1953 to December 31, 1999, in the
Corporate Administration Division.
A senior administration manager from 1967, he held the posts of Secretary to the
Corporate Administration Division (1977/1985), Joint Corporate Administration Manager
(1985/1986), Corporate Finance Administration & Control Manager (1986/1995), Deputy
General Administration Manager (1995/1999).
He has sat on the boards of directors and boards of statutory auditors of a number of
Group companies.
Attilio Rota
Degree in law – Pavia University.
Has sat on the boards of directors and boards of statutory auditors of companies in the
publishing, cement, and agriculture sectors as well as on the boards of public and private
bodies.
Practicing barrister in Bergamo.
Director-Controller of the Bergamo branch of Bank of Italy.
Carlo Secchi
Degree in economics & commerce – Bocconi University, Milan.
Diploma in economic planning (Institute of Social Studies, The Hague, 1969-1970).
Further studies at Netherlands Economic Institute and the Center for Development
Planning, Erasmus University (Rotterdam, 1970-1972).
Full professor in European Economic Policy since November 1, 1983, and director of the
Institute for Latin American Studies and Countries in Transition (ISLA) at the Bocconi
University, Milan.
Conducts research work as a member of numerous scientific committees, boards or entities
active in science and culture.
Director of various listed and unlisted companies.
Emilio Zanetti
Honorary degree in economics & commerce.
Chairman of BPU BANCA – Banche Popolari Unite from July 2003 to March 2007.
Current posts:
Ɣ
Chairman of the Management Committee of UBI BANCA – Unione di Banche Italiane
since April 2007;
Ɣ
Chairman of Banca Popolare di Bergamo S.p.A. (formerly Banca Popolare di Bergamo
– Credito Varesino) since July 1985.
Board of Statutory Auditors
Maria Martellini
Degree in economics & commerce – Bocconi University, Milan.
Works as an independent professional.
Full professor of Economics & Corporate Management, Faculty of Economics, Brescia
University. Contract professor on courses in Economics & Industrial Company
Management and Enterprise Assessment at the Bocconi University, Milan.
Claudio Cavalli
Technical-commercial high-school diploma.
Independent professional since 1967, specializing in the corporate sector.
Provides specialized consultancy in corporate economics, administration and finance,
conducts inspections and assessments, plans and organizes corporate re-organizations,
mergers, spin-offs.
Claudio De Re
Degree in economics & commerce – Bocconi University, Milan.
Independent professional since 1962.
Pietro Curcio
Degree in economics & commerce – La Sapienza State University, Rome.
Worked in the Tax Affairs Office of Esso Italiana S.p.A.
Subsequently appointed Tax Manager of Exxon Chemical, Milan; 1985, appointed Treasury
& Tax Manager at Face Finanziaria; subsequently became Chief Financial Officer at Alcatel
Italia and Treasury & Tax Manager at Alcatel Alsthom for Southern Europe.
Currently Chief Operating Officer at Finsise S.p.A.
Dino Fumagalli
Degree in economics & commerce – Bergamo University.
Independent professional since 1983.
Member of the National Commission for the Enactment of Accounting Policies, 1989 to
1991.
Eugenio Mercorio
Degree in economics & commerce – Bergamo University.
Independent professional. Certified accountant specializing in corporate and tax
consultancy and as a consultant for insolvency procedures.
Call of Shareholders’ Meeting
The Shareholders are called to a Meeting on April 17, 2009, at 10 am, in via Madonna
della Neve, 8, Bergamo, on first call and on April 20, 2009, at the same time and in the
same venue, on second call, to discuss and adopt resolutions on the following
Order of Business
1) Reports of the Board of Directors and the Board of Statutory Auditors on financial year
2008: examination of the financial statements as at and for the year to December 31,
2008, and resolutions arising.
2) Authorization for the purchase and disposal of treasury shares.
3) Appointment of statutory auditors, the Chairman of the Board of Statutory Auditors and
determination of their fee.
In accordance with the law and the company by-laws, shareholders holding ordinary
shares for which the declaration envisaged by art. 2370, para. 2, Italian Civil Code, has
been notified to the company no later than two business days before the date of the
Shareholders' Meeting are entitled to participate in the Shareholders' Meeting.
* * *
Documentation relating to the matters on the order of business will be available to the
public at the company registered office and at Borsa Italiana S.p.A. at least 15 days before
the date of first call. Shareholders are entitled to obtain copies thereof.
The documentation will also be available for consultation in the same period at the internet
address www.italcementigroup.com.
* * *
Pursuant to the by-laws, the appointment of the Board of Statutory Auditors takes place on
the basis of lists.
Lists may be presented only by shareholders who, alone or together with other
shareholders, can prove that they hold overall a percentage of the voting capital of no less
than 2%.
No shareholder may present or participate in the presentation of more than one list,
directly or through a third party or trust company, or vote for different lists.
Shareholders belonging to the same group and shareholders who adhere to a
shareholders’ agreement regarding the company shares may not present more than one
list, directly or through a third party or through trust companies.
Lists presented in violation of these restrictions will not be accepted.
Each list consists of two sections: one for candidates for acting auditor and the other for
candidates for substitute auditor.
Each section must list, in progressive order, the names of no more than three candidates
for acting auditor and no more than three candidates for substitute auditor.
Each candidate may be put forward in one list only or will be ineligible.
The lists must be deposited at the company offices at least 15 days prior to the date set
for the Shareholders’ Meeting on first call, together with the following documentation:
a) the declarations in which the individual candidates accept their nomination and take
personal responsibility for attesting the non-existence of reasons for ineligibility or
incompatibility, as well as the existence of the further requirements prescribed by the
law, the by-laws and the Voluntary Code of Conduct;
b) a short curriculum vitae giving the personal and professional details of each candidate,
indicating posts as director and auditor held in other companies;
c) information relating to the identity of the shareholders who presented the lists,
indicating the percentage stake held overall and certification proving the holding of such
a stake;
d) the declaration of shareholders, other than those who hold, also jointly, a controlling or
majority stake, attesting to the presence, or to the absence, of inter-connections
between them as defined and governed by the current laws.
A presented list that does not comply with the above provisions will be considered as not
presented.
In the event that, within the limit of 15 days preceding the date of the Shareholders’
Meeting, a single list has been deposited, or only lists presented by shareholders who are
inter-connected pursuant to current laws, additional lists may be presented up to the fifth
day following this deadline and the 2% threshold indicated above will be halved.
The Board of Directors
FRANCE
CIMENTS FRANCAIS CIMENTS CALCIA GSM UNIBÉTON AXIMITALY
ITALCEMENTI CALCESTRUZZI CTGSOCIETÀ DEL GRES AXIM ITALIA ITALGEN
NORTH AMERICA
ESSROC CIMENT QUEBEC ESSROC SAN JUAN RIVERTON ARROW CAMBRIDGE CRIDER & SHOCKEY
SPAIN
FINANCIERA Y MINERA
BELGIUM
CCB
MOROCCO
CIMENTS DU MAROCEGYPT
SUEZ CEMENT TOURAH CEMENT HELWAN RMBBULGARIA
DEVNYA CEMENT VULKANGREECE
HALYPS CEMENTTURCHIA
SETCYPRUS
VASSILIKO CEMENTEGYPT
SUEZ CEM CIMENTS CALCIA GSM UNIBÉTON AXIM C C S A ITSPAIN
FINANCIERA Y MINERAB
CMOROCC
CIMENTS DUNORTH AMERICA
Italcementi Group in the world
(as of 31
thDecember
2008)
KAZAKHSTAN
SHYMKENT CEMENT
SAUDI ARABIA
INTERNATIONAL CITY FOR READY MIX (JV)
THAILAND
JALAPRATHAN CEMENT ASIA CEMENT
CHINA
SHAANXI FUPING CEMENT
INDIA
ZUARI CEMENTTERMINALS
Albania
Gambia
Kuwait
Sri Lanka
Mauritania
(grinding center)
INDIA
ZUARI CEMENTGroup business and financial highlights
2008
2007
2006
2005
2004
(in millions of euro)
IFRS
IFRS
IFRS
IFRS
IFRS
Revenues
5,776
6,001
5,854
5,000
4,528
Recurring EBITDA
1,113
1,404
1,447
1,153
1,091
EBITDA*
1,103
1,405
1,434
1,137
1,096
EBIT 607
958
1,012
766
788
Net profit for the period
272
612
651
541
465
Group net profit
139
424
449
391
351
Investments in fixed assets
980
999
773
1,209
378
Total shareholders’ equity
4,615
4,760
4,660
4,356
3,090
Group shareholders’ equity
3,325
3,479
3,298
3,037
2,399
Net debt
2,679
2,418
2,210
2,215
1,569
Number of employees at December 31
22,243
23,706
22,868
21,854
17,377
Highlights
Breakdown of consolidated revenues by line of business
(in millions of euro)
2007
2008
%change
Cement
4,000
4,131
3.3
Ready mixed concrete/
aggregates
1,736
1,334
(23.2)
Other
264
310
17.4
Total
6,001
5,776
(3.8)
*changes at constant size and exchange rates + 1.7%
2007
66.7 % 4.4% 28.9%2008
71.5% 5.4% 23.1%Recurring EBITDA
(in millions of euro)
Sales volumes and internal
transfers by business
Cement and clinker (Mt) Aggregates (Mt) Ready mixed concrete (Mmc) 64.6*change at constant size 2007 2008
62.6 56.3 47.6 20.5 13.9 (4.3)%* 1,404 (3.1)% (6.5)%* (15.5)% (6.0)%* (32.5)%
2007
1,1132008
44.3% 5.0% 50.7% 40.4% 9.1% 50.5% North America1 2 3 4 5 6 7 8 9 10 11
Italcementi S.p.A. on the Stock Exchange
1 Share capital and shareholders
Ticker symbol
Italcementi
Italcementi bearer
Italcementi registered
ordinary shares
savings shares
savings shares
BLOOMBERG:
IT IM
ITR IM
-REUTERS:
ITAI.MI
ITAIn.MI
-ISIN:
IT0001465159
IT0001465167
IT0001465175
Savings shares 37% Ordinary shares 63%
1.a Share capital at 12.31.2008
At 12.31.2008, Italcementi S.p.A. share capital was
€
282,548,942 represented by 282,548,942 shares with a par
value of
€
1 each, of which 177,117,564 ordinary shares and
105,431,378 savings shares.
Free float 35,38% Arnhold and S.Bleichroeder
2,22% Treasury shares 2,14% Italmobiliare 60,26%
1.b Ordinary shares
Survey of shareholders with over 2% of share capital at
12.31.2008 (based on the shareholders' register, Consob
communications and other information).
Brokers and Omnibus Accounts 2% Foreign Insurance Co. 1% Italian Insurance Co. 1% Foreign Companies 1% Other 1% Private Individuals 31% Foreign Funds 25% Foreign Banks 13% Italian Banks 10% Italian Companies 8% Italian Funds 7%
1.c Ordinary shares
Breakdown of free float based on
information in the shareholders'
register for payment of the FY
2007 dividend; Shareholders
listed in the register: 24,333.
1 2 3 4 5 6 7 8 9 10 11
2 Financial Indicators
(euro)2008
2007
2006
2005
2004
Italcementi S.p.A.
Market prices
(annual average official prices):- Ordinary share
11.020
20.022
19.297
13.312
10.773
- Savings share
7.889
13.238
12.589
9.498
7.050
Per share dividend:
- Ordinary share
(1)0.180
0.360
0.360
0.330
0.300
- Savings share
(1)0.210
0.390
0.390
0.360
0.330
Dividend yield
(on annual average official prices):- Ordinary share
1.63%
1.80%
1.87%
2.48%
2.78%
- Savings share
2.66%
2.95%
3.10%
3.79%
4.68%
3.a Italcementi share prices, “Ultimo Mibtel” index and “S&P/MIB” index (01/02/2004 - 02/27/2009)
2 Jan. 04 2 Feb. 04 2 Mar
. 04 2 Apr . 04 2 May . 04
2 June 04 2 July 04 2 Aug.
04
2 Sept. 04 2 Oct. 04 2 Nov
. 04
2 Dec. 04 2 Jan. 05 2 Feb. 05 2 Mar
. 05 2 Apr . 05 2 May . 05
2 June 05 2 July 05 2 Aug.
05
2 Sept. 05 2 Oct. 05 2 Nov
. 05
2 Dec. 05 2 Jan. 06 2 Feb. 06 2 Mar
. 06 2 Apr . 06 2 May . 06
2 June 06 2 July 06 2 Aug.
06
2 Sept. 06 2 Oct. 06 2 Nov
. 06
2 Dec. 06 2 Jan. 07 2 Feb. 07 2 Mar
. 07 2 Apr . 07 2 May . 07
2 June 07 2 July 07 2 Aug.
07
2 Sept. 07 2 Oct. 07 2 Nov
. 07
2 Dec. 07 2 Jan. 08 2 Feb. 08 2 Mar 2 Jan. 09
. 08 2 Apr . 08 2 May . 08
2 June 08 2 July 08 2 Aug.
08
2 Sept. 08 2 Oct. 08 2 Nov
. 08 2 Dec. 08 2 Feb. 09 24 20 26 22 18 16 14 12 10 8 6 4 2
3.b Italcementi shares, “Ultimo Mibtel” index and “S&P/MIB” index performance (base 01.02.2004 = 100)
3 Share prices and market capitalization
2 Jan. 04 2 Feb. 04 2 Mar
. 04 2 Apr . 04 2 May . 04
2 June 04 2 July 04 2 Aug.
04
2 Sept. 04 2 Oct. 04 2 Nov
. 04
2 Dec. 04 2 Jan. 05 2 Feb. 05 2 Mar
. 05 2 Apr . 05 2 May . 05
2 June 05 2 July 05 2 Aug.
05
2 Sept. 05 2 Oct. 05 2 Nov
. 05
2 Dec. 05 2 Jan. 06 2 Feb. 06 2 Mar
. 06 2 Apr . 06 2 May . 06
2 June 06 2 July 06 2 Aug.
06
2 Sept. 06 2 Oct. 06 2 Nov
. 06
2 Dec. 06 2 Jan. 07 2 Feb. 07 2 Mar
. 07 2 Apr . 07 2 May . 07
2 June 07 2 July 07 2 Aug.
07
2 Sept. 07 2 Oct. 07 2 Nov
. 07
2 Dec. 07 2 Jan. 08 2 Feb. 08 2 Mar 2 Jan. 09
. 08 2 Apr . 08 2 May . 08
2 June 08 2 July 08 2 Aug.
08
2 Sept. 08 2 Oct. 08 2 Nov
. 08
2 Dec. 08 2 Feb. 09
“Ultimo Mibtel”
index “S&P/MIB”index Italcementi savings shares Italcementi ordinary shares “Ultimo Mibtel” index “S&P/MIB” index Italcementi savings shares Italcementi ordinary shares
3.c Italcementi share prices, “Ultimo Mibtel” index and “S&P/MIB” index (01/02/2008 - 02/27/2009)
17 16 14 12 15 13 11 10 9 8 7 6 5 4 32 Jan. 08 9 Jan. 08 16 Jan. 08 23 Jan. 08 30 Jan. 08 6 Feb. 08 13 Feb. 08 20 Feb. 08 27 Feb. 08 5 Mar
. 08 12 Mar . 08 19 Mar . 08 26 Mar . 08 2 Apr . 08 9 Apr . 08 16 Apr . 08 23 Apr . 08 30 Apr . 08
7 May 08 14 May 08 21 May 08 28 May 08 4 June 08 11 J
u
n
e
0
8
18 June 08 25 June 08 2 July 08 9 July 08 16 July 08 23 July 08 30 July 08 6 Aug.
08 13 Aug. 08 20 Aug. 08 27 Aug. 08
3 Sept. 08 10 Sept. 08 17 Sept. 08 24 Sept. 08 1 Oct. 08 8 Oct. 08 15 Oct. 08 22 Oct. 08 29 Oct. 08 5 Nov
. 08 12 Nov . 08 19 Nov . 08 26 Nov . 08
3 Dec. 08 10 Dec. 08 17 Dec. 08 24 Dec. 08 31 Dec. 08 7 Jan. 09 14 Jan. 09 21 Jan. 09 28 Jan. 09 4 Feb. 09 11 Feb. 09 18 Feb. 09 25 Feb. 09
3.d Italcementi shares, “Ultimo Mibtel” index and “S&P/MIB” index performance (base 01.02.2008 = 100)
2 Jan. 08 9 Jan. 08 16 Jan. 08 23 Jan. 08 30 Jan. 08 6 Feb. 08 13 Feb. 08 20 Feb. 08 27 Feb. 08 5 Mar
. 08 12 Mar . 08 19 Mar . 08 26 Mar . 08 2 Apr . 08 9 Apr . 08 16 Apr . 08 23 Apr . 08 30 Apr . 08
7 May 08 14 May 08 21 May 08 28 May 08 4 June 08 11 J
u
n
e
0
8
18 June 08 25 June 08 2 July 08 9 July 08 16 July 08 23 July 08 30 July 08 6 Aug.
08 13 Aug. 08 20 Aug. 08 27 Aug. 08
3 Sept. 08 10 Sept. 08 17 Sept. 08 24 Sept. 08 1 Oct. 08 8 Oct. 08 15 Oct. 08 22 Oct. 08 29 Oct. 08 5 Nov
. 08 12 Nov . 08 19 Nov . 08 26 Nov . 08
3 Dec. 08 10 Dec. 08 17 Dec. 08 24 Dec. 08 31 Dec. 08 7 Jan. 09 14 Jan. 09 21 Jan. 09 28 Jan. 09 4 Feb. 09 11 Feb. 09 18 Feb. 09 25 Feb. 09
“Ultimo Mibtel”
index “S&P/MIB”index Italcementi savings shares Italcementi ordinary shares “Ultimo Mibtel” index “S&P/MIB” index Italcementi savings shares Italcementi ordinary shares
3.f Average monthly capitalization (January 2008 - February 2009)
3.e Share prices and market capitalization from 01.02.2008 to 02.27.2009
Share price
(euro)
Capitalization
(millions of euro)
01.02.08
high
low
02.27.09
01.02.08
high
low
02.27.09
Ordinary shares
14.447
14.447
6.538
7.080
2,559
2,559
1,158
1,254
Savings shares
10.754
10.754
3.944
4.243
1,134
1,134
416
447
Total
3,693
3,693
1,574
1,701
“Ultimo Mibtel”
29,058
29,058
12,494
12,526
“S&P/MIB”
38,035
38,063
15,218
15,282
3 Share prices and market capitalization
Total capitalization Italcementi savings shares Italcementi ordinary shares
4 Trading volumes on the Italian Stock Exchange
Month
Ordinary shares (euro)
Savings shares (euro)
Number
Average
Trade
Number
Average
Trade
of traded
monthly
value
of traded
monthly
value
shares
price
shares
price
January 2008
31,138,219
13.597
423,380,994
6,565,722
9.811
64,415,556
February
23,901,665
13.174
314,887,765
7,036,231
9.459
66,556,498
March
18,374,226
12.548
230,553,817
3,554,087
9.001
31,989,480
April
26,351,120
13.793
363,469,374
7,337,659
9.964
73,111,585
May
19,267,948
13.411
258,396,163
9,808,434
9.929
97,390,006
June
18,827,513
11.738
220,993,780
5,335,700
8.587
45,816,654
July
30,602,614
9.386
287,221,472
5,511,850
6.935
38,222,293
August
21,179,302
9.175
194,310,646
3,284,303
7.190
23,614,520
September
36,810,398
9.864
363,093,996
3,763,369
7.443
28,011,491
October
25,832,590
8.283
213,978,167
4,540,197
6.068
27,548,740
November
8,447,423
8.481
71,638,661
3,131,674
5.004
15,670,941
December
11,820,228
8.604
101,703,703
2,086,850
4.658
9,720,954
January 2009
19,520,219
8.152
159,122,828
3,341,533
5.180
17,309,053
February
15,103,312
7.386
111,546,042
2,580,828
4.491
11,589,541
307,176,777
3,314,297,408
67,878,437
550,967,312
4.a Turnover
Italcementi savings shares Italcementi ordinary sharesDirectors’ report
Following the adoption by the European Union of Regulation no. 1606 of 2002, the
Italcementi S.p.A. consolidated financial statements for 2008, and the comparatives for
financial year 2007, which have already been published, have been drawn up in
compliance with the International Accounting and Financial Reporting Standards
(IAS/IFRS).
The changes that have taken place in the reporting standards and interpretations since
2007 are set out in detail in the notes, in the section “Declaration of compliance with the
IFRS”. They did not produce any material effects. In accordance with the aforementioned
Regulation, the principles to be adopted do not include the standards and interpretations
published by the International Accounting Standards Board (IASB) and the International
Financial Reporting Interpretations Committee (IFRIC) at December 31, 2008, but not
adopted by the European Union at that date. Furthermore, the European Union has
adopted additional standards /interpretations, which Italcementi S.p.A. will apply as from
2009, having decided not to elect early application.
Scope of consolidation – Changes
As noted in the report to the 2007 consolidated financial statements and the subsequent
quarterly and half-year reports for the financial year under analysis, as a consequence of
the preventive seizure of the assets of Calcestruzzi S.p.A. ordered on January 29, 2008
and still in effect, the
Calcestruzzi group
, pursuant to IAS 27 § 21, is no longer included in
the scope of consolidation.
The other main changes in the
scope of consolidation
concern the acquisitions in 2007 of
companies active in the ready mixed concrete sector in North America and in Egypt and in
the cement sector in China and in Kuwait, as well as the acquisitions in 2008 of:
-
Verticalnet Inc.
(e-business, USA), consolidated since the end of January 2008;
-
Crider & Shockey
(ready mixed concrete, USA) consolidated as from March 2008;
-
Kuwait German Ready Mix
(ready mixed concrete, Kuwait) consolidated on a line-by-line
basis as from May 2008;
-
Misr for Energy SAE
(Egypt),
Italgen Elektrik Uretim A.S.
and
Bares Elektrik Uretimi
A.S.
(Turkey), active in the energy sector and part of the Italgen Group, consolidated on a
line-by-line basis as from the second half of 2008;
-
Al Mahaliya
(ready mixed concrete, Kuwait) consolidated on a line-by-line basis as from
July 2008, and the investment in the newly formed joint venture
International City for
Ready Mix
(ex Arabian Ready Mix Co.; ready mixed concrete, Saudi Arabia), consolidated
on a proportionate basis since the beginning of 2008.
As noted in the quarterly report at September 30, 2008, since the agreement for the sale of
the operations of the companies Set Group, Set Cimento, Set Beton and Afyon Cimento
was not executed, the Group decided to review its options with a view to strategically
optimizing its operations in Turkey. The operations in question are no longer deemed
available for sale and are therefore consolidated on a line-by-line basis, whereas in the
quarterly report at March 31, 2008, and the half-year report at June 30, 2008, they were
treated in compliance with IFRS 5.
Earnings indicators
To assist comprehension of its business and financial data, the Group employs a number of
widely used indicators, which are not contemplated by the IAS IFRS.
Specifically, the income statement presents the following intermediate results / indicators:
Recurring EBITDA, EBITDA, EBIT, computed as the sum of the preceding items. On the
balance sheet, similar considerations apply to net debt, whose components are detailed in
the specific section of the notes.
Since the indicators employed by the Group are not envisaged by the IAS IFRS, their
definitions may not coincide with and therefore not be comparable to those adopted by
other companies/groups.
This report contains many financial and non-financial earnings indicators, including those
indicated above. The financial indicators, taken from the financial statements, are used in
the tables summarizing Group business, equity and financial performance, in relation to
comparative values and other values from the same period (e.g., change in revenues,
recurring EBITDA and EBIT with respect to the previous year, and change in their return on
revenues). The use of economic values not directly apparent from the financial statements
(e.g., the exchange-rate effect on revenues and on earnings) and the presentation of
comments and assessments assists qualification of the trends in the values concerned.
The directors’ report also provides a series of financial ratios (gearing, leverage, coverage)
that are clearly of importance for a better understanding of Group performance, especially
with respect to the previous period. The non-financial indicators refer to external and
internal elements: the situation of the general economy and the industry in which the Group
operates, trends on the various markets and lines of business, trends in sales prices and
cost factors, acquisitions and disposals, other significant events in the period,
organizational developments, the introduction of laws and regulations, etc. In the notes, the
section on the net financial position provides information about the effects of changes in
interest rates and the main exchange rates on the balance sheet and the income
statement.
Results and significant events for the year
Results
Inevitably, the Group’s results were affected by the international economic events of 2008.
Specifically, in the first half, the sharp rise in raw materials prices, especially energy prices,
was a significant factor. Subsequently, as the financial crisis spread from the USA across
the world, its repercussions began to emerge in many sectors of the real economy.
Under these conditions, Group revenues held well despite negative effects from the scope
of consolidation, volumes and exchange rates. Operating results, on the other hand,
showed a significant decline. This had a negative impact on profit for the year, which was
also adversely affected by adjustments to financial asset values, but benefited from
non-recurring finance income. Given the earnings downturn, income tax was significantly lower
in absolute terms than in 2007. Consolidated revenues totaled 5,775.6 million euro, a
decrease of 3.8% (+1.7% at constant size and exchange rates).
Recurring EBITDA, at 1,113.1 million euro, fell by 20.7% on 2007.
After a small increase in amortization and depreciation (+1.1%) and impairment variations
(44.7 million euro), EBIT was 607.3 million euro (-36.6%).
Profit before tax
, at 420.8 million euro (851.9 million euro in 2007), also reflected the
negative impact of adjustments to financial asset values totaling 124.9 million euro (absent
in 2007) and referring largely to the write-down on the equity investment in the Turkish
company Goltas, to Calcestruzzi and to other financial assets, but benefited from
non-recurring finance income of 50 million euro arising from final recognition of the advance
received in connection with the termination of the agreement for the sale of operations in
Turkey.
The earnings decline produced a reduction in
income tax expense
, from 239.4 million
euro in 2007 to 148.5 million euro in 2008.
Net profit for the year
was 272.2 million euro (612.5 million euro in 2007), while
net profit
attributable to the Group
was 138.8 million euro (423.9 million euro in 2007).
Minority
interests
decreased from 188.6 million euro to 133.4 million euro.
Net debt
at December 31, 2008, was 2,679.3 million euro, up by 419.0 million euro from
the situation at December 31, 2007, restated for comparative purposes to exclude amounts
for the Calcestruzzi group, which is not included in the 2008 scope of consolidation.
Total shareholders' equity
, at 4,615.0 million euro, decreased by 145.5 million euro from
December 31, 2007, while
Group shareholders' equity
amounted to 3,324.8 million euro,
down by 154.7 million euro from the end of 2007.
Significant events for the year
The significant events of the
fourth quarter of 2008
are described below.
Ɣ
As noted above, in October the agreement between
Ciments Français
and
OJSC
Holding Company Sibirskiy Cement
for the sale to the latter of SET Group
operations in Turkey was terminated. The
non-execution of the agreement
led to final
recognition of the advance received;
Ɣ
in November,
Moody’s Investor Services reviewed its rating
for Italcementi to
Baa2/stable from the previous Baa1/negative. The Baa1 rating for the subsidiary
Ciments Français was confirmed, with the outlook downgraded from stable to negative;
Ɣ
in December the
sale
to Sirci S.p.A. of the Italsintex S.p.A. company, which operates
with the
Gresintex
trademark, was finalized;
Ɣ
under the program approved by the Shareholders' Meeting of April 14, 2008,
Ciments
Français S.A.
acquired
136,073
treasury shares
for a value of approximately 6.9
million euro. These shares joined the 566,999 treasury shares already purchased
during the year (value 60.1 million euro). Considering that on July 31, 2008, the Board
of Directors of Ciments Français S.A. decided to
cancel
964,522 shares, at December
31, 2008,
treasury shares
numbered 476,205 accounting for approximately 1.3% of
share capital.
Significant events in the
first nine months
of 2008, already reported in the 2008 half-year
and quarterly reports, are described below. A number of
acquisitions took place
during
the period, most notably:
Ɣ
the
grinding center
for cement production in
Ravenna
;
Ɣ
the US company
Verticalnet, Inc.,
which was merged with
BravoSolution USA, Inc.
into a new entity with the name Verticalnet, Inc. dba (doing business as) BravoSolution
US;
Ɣ
Kuwait German Ready Mix and Al Mahaliya, two companies active in ready mixed
concrete in Kuwait, acquired through Hilal Cement Company;
Ɣ
Bares Elektrik Uretimi A.S., a Turkish company that holds the licenses for
construction of a wind farm in the Balikesir region (North-West Turkey), acquired by
Italgen S.p.A. through its Turkish subsidiary Italgen Elektrik Uretim A.S.;
Ɣ
the purchase on the market by Société Internationale Italcementi France S.a.s. of
139,310 Ciments Français shares, for an outlay of approximately 14.6 million euro.
Ɣ
Other significant events in the first nine months of 2008 already mentioned in the
half-year and quarterly reports included:
Ɣ
the sale to a third party of all shares held in the Domiki Beton S.A. company by
Calcestruzzi S.p.A. and Halyps S.A.;
Ɣ
the announcement of a new partnership agreement with the Muhaidib Saudi group,
under which Ciments Français will take a 12.5% shareholding in a new cement plant
in Syria;
Ɣ
the licensing agreement with Heidelberg Cement for joint use of a series of patents for
photocatalytic cements and binders developed by the Italcementi Group and for the TX
Active® brand. The agreement marked the launch of a new technical research
cooperation program;
Ɣ
the agreement with the Libyan Fund for Economic and Social Development to build a
new cement plant about 50 km from Tobruk, in Eastern Libya. The industrial plan for
this equally owned joint venture envisages construction of a plant with an annual
capacity of 4 million metric tons of Portland cement and an option for a new white
cement line;
Ɣ
the rating review by Standard & Poor’s, which lowered its long-term ratings for
Italcementi and Ciments Français from “BBB+” to “BBB”; the outlook for both
companies is stable;
Ɣ
the confirmation, for 2008-2009, of Italcementi as one of the companies in the Dow
Jones Sustainability World Index (DJSI World).
The international economy and industry trends
Economic trends in 2008 were exceptional on many fronts. The gradual economic decline
driven by a deepening and ever broader financial crisis brought to an end one of the most
intensive phases of income growth ever recorded at world level. The speed at which the
turbulence in the financial sector spread to the real economy and its impact on areas and
countries apparently unconnected with the epicenter of the crisis were entirely unexpected.
The sudden change in the economic climate in 2008 was reflected in, among other things,
raw materials prices, energy in particular: after hitting new highs in the first half of the year,
prices dropped abruptly as from July.
In many countries, the response of governments and central banks focused initially on
monetary policy, with interest-rate cuts, huge injections of liquidity and measures providing
direct support for financial firms in greatest difficulty. Sweeping fiscal plans were also
announced in many countries: the positive impact such plans may have on confidence and
on the economy will emerge only at a later date, since implementation of initiatives of this
type is a longer process.
The sudden slowdown in the mature countries hit the emerging area, including the most
dynamic Asian regions, at three levels: the reduction in exports, the flight from high-risk
activities, the fall in raw materials prices. Together with a significant slowdown in the growth
rate, the emerging area also experienced a growing differentiation in cyclical positions, with
countries with high current deficits and/or weak financial structures more exposed to
financial instability. Instability was also seen on the currency markets, in the emerging area
and elsewhere. The dollar/euro exchange rate was particularly volatile, with only a partial
recovery at the end of the year from the new lows reached in the first half of 2008.
In the construction sector, the worsening financial crisis turned into a powerful factor
amplifying existing difficulties on many mature markets, chiefly due to the severe squeeze
on credit almost everywhere. Furthermore, the general deterioration in economic
expectations had an hard impact on private and business building projects, which are
generally very sensitive to economic conditions.
In the USA, the slowdown in the residential sector was far stronger than expected,
generating what has now become the most grave and prolonged recession of the postwar
period. In the European countries where the Group operates, the decline set in at different
times and rates; nevertheless the business slump accelerated everywhere in the second
half. Although business activity weakened throughout the emerging area, the cyclical
differential widened both in the Mediterranean area and in Asia. In the Mediterranean,
Morocco and Egypt continued to report very healthy performance; among the Group’s
Asian countries, where growth continued, beginning with India, Thailand stood out for its
poor performance, due to continuing domestic political unrest.
Business and financial performance in 2008
Key consolidated figures
(in millions of euro)
2008
2007
% change
vs. 2007
Revenues
5,775.6
6,000.9
(3.8)
Recurring EBITDA
1,113.1
1,403.9
(20.7)
% of revenues
19.3
23.4
Other non-recurring income (expense)
(10.3)
1.1
n.s.
EBITDA
1,102.9
1,405.1
(21.5)
% of revenues
19.1
23.4
Amortization and depreciation
(450.9)
(445.9)
1.1
Impairment variation
(44.7)
(1.2)
>100
EBIT
607.3
958.0
(36.6)
% of revenues
10.5
16.0
Finance income (costs)
(86.7)
(119.4)
(27.3)
Impairment on financial assets
(124.9)
-
n.s.
Share of results of associates
25.1
13.3
88.5
Profit before tax
420.8
851.9
(50.6)
% of revenues
7.3
14.2
Income tax expense
(148.5)
(239.4)
(38.0)
Net profit for the year
272.2
612.5
(55.6)
% of revenues
4.7
10.2
Group net profit
138.8
423.9
(67.3)
Minority interest
133.4
188.6
(29.3)
Cash flow from operating activities
634.9
935.0
(32.1)
Quarterly trend
(in millions of euro)
Full year
2008
Q4
2008
Q3
2008
Q2
2008
Q1
2008
Revenues5,775.6
1,356.2
1,493.3
1,574.9
1,351.1
% change vs. 2007(3.8)
(2.3)
(3.0)
(4.8)
(4.7)
Recurring EBITDA1,113.1
207.1
312.7
334.6
258.7
% change vs. 2007(20.7)
(30.6)
(18.9)
(23.5)
(8.5)
% of revenues19.3
15.3
20.9
21.2
19.1
EBITDA1,102.9
201.0
306.8
335.6
259.5
% change vs. 2007(21.5)
(30.3)
(21.3)
(24.2)
(8.8)
% of revenues19.1
14.8
20.5
21.3
19.2
Amortization and depreciation
(450.9)
(126.8)
(107.1)
(109.0)
(107.9)
Impairment variation
(44.7)
(44.7)
0.1
(0.1)
EBIT
607.3
29.5
199.8
226.6
151.4
% change vs. 2007
(36.6)
(82.8)
(28.2)
(31.7)
(14.0)
% of revenues
10.5
2.2
13.4
14.4
11.2
Finance income (costs)
(86.7)
22.1
(36.8)
(35.1)
(36.9)
Impairment on financial assets
(124.9)
(98.3)
(11.4)
(15.2)
Share of results of associates
25.1
6.4
5.6
12.3
0.8
Net profit for the period
272.2
(53.0)
106.5
137.3
81.3
% of revenues
4.7
(3.9)
7.1
8.7
6.0
Group net profit
138.8
(56.6)
65.9
91.6
37.9
% of revenues
2.4
(4.2)
4.4
5.8
2.8
Net debt
2,679.3
2,679.3
2,581.4
2,608.3
2,306.5
(at end of period)
Fourth-quarter sales volumes and internal transfers
Q4
2008
Q4
2008
Q4
2008
Historic Constant size Historic Constant size Historic Constant size Central Western Europe5.5
(11.6)
(11.4)
9.9
(13.0)
(13.0)
1.7
(15.9)
(15.9)
North America1.1
(20.3)
(20.3)
0.1
55.0
(2.6)
0.2
8.5
(9.6)
Eastern Europe and
Southern Med Rim
4.9
0.3
0.3
0.5
(28.5)
(28.5)
0.9
(7.5)
(7.5)
Asia
2.6
(9.3)
(9.3)
0.1
(20.6)
(20.6)
0.2
(25.3)
(25.3)
Cement and
clinker trading
1.0
(27.4)
(27.3)
-
-
-
0.1
-
-Eliminations and others
(0.8)
n.s.
n.s.
-
-
-
-
-
-Total
14.3
(8.6)
(8.5)
10.6
(13.6)
(13.9)
3.1
(10.0)
(13.4)
n.s. not significant
Amounts refer to companies consolidated on a line-by-line basis and, pro-quota, to companies consolidated on a proportionate basis (*) excluding outgoes on the work-in-progress account
Central Western Europe: Italy, France, Belgium, Spain, Greece - North America: U.S.A., Canada - Eastern Europe and Southern Med Rim: Egypt, Bulgaria, Morocco, Turkey - Asia: India, Thailand, China, Kazakhstan
% change vs. Q4 2007 % change vs. Q4 2007 % change vs. Q4 2007
Cement and clinker
(millions of metric tons)
Aggregates*
(millions of metric tons)
Ready mixed concrete
At constant size, fourth-quarter sales volumes, affected by particularly unfavorable
meteorological conditions in Central Western Europe, decreased overall in all lines of
business with respect to the year-earlier period.
In the cement and clinker sector, there was a sharp drop in sales volumes in North
America, Central Western Europe, Asia and Trading. Southern Europe and the Southern
Med Rim reported a small improvement driven by healthy performance in Morocco, which
more than made up for the contained reduction on the other markets.
The significant decline in Central Western Europe (France-Belgium, Spain) affected Group
performance in aggregates and ready mixed concrete. Greece reported satisfactory
growth in both sectors; in ready mixed concrete, Egypt made progress and Morocco was
substantially stable.
Fourth-quarter results
In the fourth quarter, the slowdown in volumes caused by the growing impact of the
financial crisis on the real economy (especially in some industrialized countries) pushed
revenues down to 1,356.2 million euro (-2.3% YoY). The decrease was mitigated by good
performance in some emerging countries (Egypt, Morocco and Bulgaria) and by the
globally positive sales price dynamic.
An important reduction was reported in North America, Central Western Europe and
Trading.
Recurring EBITDA was 207.1 million euro, down 30.6% from the year-earlier period. The
result reflected lower sales volumes and the negative dynamic in operating expenses,
whose impact was offset only in part by the start of the downturn in energy costs and the
positive sales price trend.
EBIT was 29.5 million euro (-82.8%), after an increase in amortization and depreciation
(+10.6 million euro, or 9.2%) and, above all, impairment losses of 44.7 million euro on fixed
assets, compared with negligible amounts (0.6 million euro) in the fourth quarter of 2007,
as described in the notes.
The fourth quarter posted a net loss of 53.0 million euro (net profit of 146.8 million euro in
the year-earlier period), reflecting the impact of adjustments to financial asset values
totaling 98.3 million euro (75.6 million euro on the equity investment in Turkey’s Goltas,
15.4 million euro on Calcestruzzi and 7.3 million euro on other financial assets). As
mentioned earlier, after the termination of negotiations for the sale of operations in Turkey,
recognition of the advance of 50 million euro was finalized; the amount was classified
under finance income.
Full-year sales volumes and internal transfers
Sales volumes by geographical area
2008
2008
2008
Historic Constant size Historic Constant size Historic Constant size Central Western Europe24.0
(7.3)
(6.7)
43.7
(16.9)
(7.0)
7.4
(49.3)
(8.9)
North America5.3
(14.7)
(14.7)
0.5
64.2
2.8
1.0
17.5
(7.9)
Eastern Europe and
Southern Med Rim
20.6
(2.1)
(2.1)
2.6
(3.3)
(3.3)
4.4
7.1
0.7
Asia
11.3
4.4
(1.1)
0.7
7.8
7.8
0.8
(11.3)
(11.3)
Cement and
clinker trading
5.5
(10.4)
(15.3)
-
-
-
0.2
-
-Eliminations and others
(4.0)
n.s.
n.s.
-
-
-
-
-
-Total
62.6
(3.1)
(4.3)
47.6
(15.5)
(6.5)
13.9
(32.5)
(6.0)
n.s. not significant
Central Western Europe: Italy, France, Belgium, Spain, Greece - North America: U.S.A., Canada - Eastern Europe and Southern Med Rim: Egypt, Bulgaria, Morocco, Turkey - Asia: India, Thailand, China, Kazakhstan
% change vs. 2007 % change vs. 2007 % change vs. 2007
(*) excluding outgoes on the work-in-progress account
Cement and clinker
(millions of metric tons)
Aggregates*
(millions of metric tons)
Ready mixed concrete
(millions of m³)
Amounts refer to companies consolidated on a line-by-line basis and, pro-quota, to companies consolidated on a proportionate basis
Compared with 2007, Group sales volumes were down in all lines of business at constant
size, with a particularly significant reduction in the fourth quarter.
In cement and clinker, the sales volumes decline arose largely in the mature countries
(especially Italy, Spain and North America), and in Trading. In the emerging countries,
domestic cement sales were substantially stable as a result of improvements in Bulgaria,
Morocco, Egypt, India and China, offset by decreases in Turkey, Thailand and Kazakhstan.
Sales volumes in aggregates, at constant size, were affected by the heavy decline in
Spain, a more contained reduction in France and positive performance on the other
markets (notably Belgium, Greece and Morocco).
In ready mixed concrete, also at constant size, the slowdown in Central Western Europe
produced a fall in overall volumes, despite healthy performance in Egypt and Morocco.
The larger reduction reported on an historic basis in aggregates and ready mixed concrete
reflects the impact of deconsolidation of the Calcestruzzi S.p.A. group, which was
consolidated until September 30, 2007. This effect was compensated in part by the ready
mixed concrete acquisitions in North America and Egypt.
Revenues and operating results
Contribution to consolidated revenues
(in millions of euro)
%
%
%
% (*)
Line of business
Cement and clinker
4,131.2
71.5
4,000.3
66.7
3.3
1.9
Ready mixed concrete and aggregates
1,334.0
23.1
1,736.4
28.9
(23.2)
(0.2)
Miscellaneous
310.4
5.4
264.3
4.4
17.4
12.4
Total 5,775.6
100.0
6,000.9
100.0
(3.8)
1.7
Geographical area
Central Western Europe
3,217.2
55.7
3,593.5
59.9
(10.5)
(2.3)
North America
500.4
8.7
605.7
10.1
(17.4)
(14.3)
Eastern Europe and Southern Med Rim
1,347.1
23.3
1,172.7
19.5
14.9
7.0
Asia
414.9
7.2
415.9
6.9
0.2
17.0
Trading
296.0
5.1
213.1
3.6
38.9
21.5
Total 5,775.6
100.0
6,000.9
100.0
(3.8)
1.7
(*) at constant size and exchange rates
2008
2007
Change
2008/07
Revenues and operating results by geographical area
(in millions of euro)
2008 % change vs. 2007 2008 % change vs. 2007 2008 % change vs. 2007 2008 % change vs. 2007 Central Western Europe
3,331.4
(9.2)
564.9
(20.4)
581.3
(19.8)
344.0
(30.6)
North America500.4
(17.4)
55.5
(56.5)
53.2
(58.2)
8.3
(89.7)
Eastern Europe and
Southern Med Rim
1,358.9
11.6
395.1
(9.2)
371.8
(11.6)
231.5
(21.8)
Asia
449.5
1.2
105.1
(15.5)
103.8
(15.8)
38.0
(53.5)
Cement and
clinker trading
370.8
1.7
18.1
(11.5)
18.3
(15.9)
13.5
(31.2)
Others and inter-area
eliminations