HeidelbergCement Results January to March 2007 Heidelberg, 10 May 2007 Dr. Bernd Scheifele, CEO and Dr. Lorenz Näger, CFO Slide 1-09.05.2007
Contents Overview Key figures Results per Group area Financial report Outlook Slide 2-09.05.2007
Overview: Excellent start in 2007 Turnover rises by 18.1 %, exceeding EUR 2 billion Significant increases in Eastern Europe, Norway, Germany, Turkey and maxit Group Another high rise in operating income With EUR 119 million, profit for the financial year more than trebled HeidelbergCement is reviewing its options regarding Hanson PLC Slide 3-09.05.2007
Rise in HeidelbergCement share price Share price January 2006 to April 2007 Index (Base: 2 January 2006 = 100) 160,0 150,0 140,0 130,0 120,0 110,0 100,0 90,0 Jan. 06 Feb. 06 Mrz. 06 Apr. 06 Mai. 06 Jun. 06 Jul. 06 Aug. 06 Sep. 06 Okt. 06 Nov. 06 Dez. 06 Jan. 07 Feb. 07 Mrz. 07 Apr. 07 HeidelbergCement share MDAX Slide 4-09.05.2007
Contents Overview Key figures Results per Group area Financial report Outlook Slide 5-09.05.2007
Significant increase in cement and clinker sales volumes January March in Mt +32.8% +24.4% +23.3% +12.5% +8.2% +27.4% +19.8% -11.2% -11.2% 5,1 6,3 7,7 8,3 4,8 5,2 5,8 6,6 3,4 2,8 3,0 3,0 2005 2006 LFL 2007 2005 2006 LFL 2007 2005 2006 LFL 2007 North America Europe-Central Asia Asia-Africa- Total Group 2005: 12.7 Mt 2006: 14.8 Mt (+16.8%) Like for like*: 16.5 Mt (+12.1%) 2007: 17.9 Mio t (+20.9%) Mediterranean Basin * without newly consolidated companies Slide 6-09.05.2007
Double-digit increase in ready-mixed concrete and aggregates Sales volumes January to March* Ready-mixed concrete Mm 3 Aggregates Mt +25.6% 19.046 15.164 +15.3% 5.356 6.173 Mm 3 Mm 3 Mt Mt 1-3 2006 1-3 2007 1-3 2006 1-3 2007 (*Icluding non-consolidated volumes) Slide 7-09.05.2007
Turnover rises by 18% January March in EURm +34,0% +24.6% 367 +50.7% 553-10.7% 493 541 674 903 230 +21.7% 280 +26.3% 354 2005 2006 2007 North America 2005 2006 2007 Europe-Central Asia 2005 2006 2007 Asia-Africa- Mediterranean Basin +9.0% 199 217 +28.2% 278 2005 2006 2007 maxit Group +21.1% +15.2% 123 149 171 2005 2006 2007 Group Services Total Group 2005 1,355 2006 1,744 (+28.7%) 2007 2,060 (+18.1%) Slide 8-09.05.2007
Operating income with strong organic growth EURm January - March 2007 PY Act Var. PY % Operative % Cons. Decons. Currency Europe-Central Asia -32 40 73 69 4 0 0 North America 63 54-9 -13,9% -3-5,2% -6 Asia-Africa- Mediterranean Basin 33 47 14 41,2% 9 28,6% 8 1-4 maxit Group -4 15 19 19 Group Services 4 2-2 -41,8% -1-36,5% 0 Total 64 159 95 148,8% 92 171,1% 13 0-10 Slide 9-09.05.2007
Sharp rise in key figures EURm Turnover OIBD Operating income 2.100 300 +18.1% +49.0% 160 +149% 1.800 1.500 1.200 900 600 1.355 +28.7% 1.744 2.060 200 100 +123% 190 283 120 80 40 64 159 300 0 0 85 0-40 -35 1-3 2005 1-3 2006 1-3 2007 Slide 10-09.05.2007
Contents Overview Key figures Results per Group area Financial report Outlook Slide 11-09.05.2007
Highest growth in Europe-Central Asia Generally favourable economic environment with significant upswing in Germany High rise in sales volumes and turnover, especially in Eastern Europe, Norway and Germany boosted by mild winter Progress in efficiency and productivity led to considerable improvement of results Ground breaking ceremony for greenfield plant in Tula/Moscow area January - March EURm 2006 2007 variance Op. Cons. Curr. Turnover 674 903 229 34,0% 204 23 2 OIBD 36 107 71 197,0% 68 3 0 in % of turnover 5% 12% Operating income -32 40 73 69 4 0 Shipments Cement/clinker (mt) 6,25 8,30 32,8% Rmc (m cbm)* 2,84 3,59 26,5% Aggregates (mt)* 9,64 13,58 40,9% * incl. non-consolidated volumes Slide 12-09.05.2007
North America slightly weakened Strong commercial construction partly compensates for decline in housing sector Fully utilised domestic cement capacities Imports were cut back according to market demand Deliveries of ready-mixed concrete and aggregates fell slightly due to bad weather on the East Coast Turnover declined by 2.7 % in USD January - March EURm 2006 2007 variance Op. Cons. Curr. Turnover 553 493-59 -10,7% -14-45 OIBD 88 77-11 -12,3% -3-8 in % of turnover 16% 16% Operating income 63 54-9 -13,9% -3-6 Shipments Cement/clinker (mt) 3,36 2,99-11,2% Rmc (m cbm) 2,07 2,06-0,6% Aggregates (mt) 5,53 5,46-1,2% Slide 13-09.05.2007
Asia-Africa-Mediterranean Basin Cement and clinker sales volumes rose like for like by 12.5 % Continuous economic expansion in emerging Asian markets Recovery of cement market in Indonesia and high increase in China and India USD 100 million investment in increase of cement capacity in Tanzania Turkey changed from cement exporter to importer due to high domestic demand January - March EURm 2006 2007 variance Op. Cons. Curr. Turnover 280 354 74 26,3% 60 36-23 OIBD 54 68 14 26,6% 9 10-5 in % of turnover 19% 19% Asia 38 40 2 4,7% -5 10-4 Africa 10 18 8 78,7% 9-1 Med. Basin 6 10 4 69,2% 5-1 Operating income 33 47 14 41,2% 9 9-4 Shipments Cement/clinker (mt) 5,17 6,58 27,4% Rmc (million cbm) 0,45 0,52 17,2% Slide 14-09.05.2007
Group Services Slight increase in cement and clinker trading volumes Opening of new sales office in Shanghai End of May Cost-effective purchase of fossil fuels thanks to longterm supply contracts January - March EURm 2006 2007 variance Op. Cons. Curr. Turnover 149 171 23 15,2% 34-11 OIBD 4 2-2 -40,4% -1 0 in % of turnover 3% 1% Operating income 4 2-2 -41,8% -1 0 Traded volume Cement (mt) 1,9 1,7-11,8% Clinker (mt) 0,9 1,2 27,8% Slide 15-09.05.2007
maxit Group continues success story Positive development in almost all markets, especially in Northern and Eastern Europe Double-digit growth in sales volumes and turnover in most countries Significant improvement of results due to restructuring in Germany High priority of cost-efficiency in all countries Focus on products with added value January - March EURm 2006 2007 variance Op. Cons. Curr. Turnover 217 278 61 28,2% 61 OIBD 8 29 20 240,2% 20 in % of turnover 4% 10% Operating income -4 15 19 19 Slide 16-09.05.2007
Contents Overview Key figures Results per Group area Financial report Outlook Slide 17-09.05.2007
Financial key figures significantly improved January - March variance analysis EURm 2006 2007 variance Op. Cons. Curr. Turnover 1.744 2.060 316 18,1% 335 19,2% 58-77 OIBD 190 283 93 49,0% 94 49,2% 13-13 in % of turnover 10,9% 13,7% Operating income 64 159 95 148,8% 92 144,6% 13-10 Group share in profit 29 109 80 272,1% EPS in EUR (IAS 33) 0,25 0,94 Investing activities Fixed assets 96 137 41 Financial assets 66 103 37 Total investments 162 240 78 Slide 18-09.05.2007
Profit and loss accounts January-March 2007 EURm March March March Change 2005 2006 2007 2007/2006 Turnover 1.355 1.744 2.060 18 % Operating income before depreciation (OIBD) 85 190 283 49 % Depreciation of tangible fixed assets and intangible assets -120-126 -124-1 % Operating income -35 64 159 149 % Additional ordinary result -21 22 37 69 % Results from other participations 11 27 17-37 % Earnings before interest and income taxes (EBIT) -44 113 213 88 % Financial result -54-45 -52 16 % Profit/loss before tax -99 68 161 136 % Taxes on income 2-31 -42 34 % Profit/loss for the financial year -96 37 119 222 % Group share -105 29 109 272 % Slide 19-09.05.2007
Cash flow statement January-March 2007 EURm January-March January-March January-March 2005 2006 2007 Cash flow from operating activities Cash flow -6 103 185 Changes in working capital -201-207 -170-67 -207-22 Cash flow from investing activities Intangible assets -1-1 -3 Tangible fixed assets -92-95 -134 Financial fixed assets -47-66 -103 Proceed from fixed asset disposals/consolidation 35-105 40-122 19-221 Cash flow from financing activities Capital increase 272 0 0 Dividend payments -4-5 -2 Net proceeds from bonds and loans 4 272 160 155 246 244-40 -34 1 Change in cash & cash equivalents Cash & cash equivalents at 1 January 305 317 219 Effect of exchange rate changes 7 19 0 Cash & cash equivalents on 31 March (*) 272-40 302-34 220 1 Slide 20-09.05.2007 (*) In the balance sheet, the item "Securities and similar rights" also lists the market value of hedging transactions and the "available for sale financial assets" amounting to: EUR 6.8 million (previous year: 35.5)
Balance sheet as of 31 March 2007 EURm 31 Dec. 2005 31 Dec. 2006 31 Mar. 2007 Variance Mar/Dec Assets Intangible assets 2.455 2.803 2.849 47 Tangible fixed assets 5.495 5.541 5.518-23 Financial fixed assets 1.157 1.162 1.200 38 Fixed assets 9.107 9.506 9.567 61 Deferred taxes 170 133 136 3 Receivables 1.423 1.549 1.700 151 Stocks 870 896 925 29 Cash at bank and in hand 365 234 227-8 Balance sheet total 11.935 12.318 12.555 237 Liabilities Capital entitled to shareholders 4.630 5.348 5.444 95 Minority interests 428 480 503 24 Equity 5.058 5.828 5.947 119 Provisions 1.346 1.282 1.266-16 Deferred taxes 493 507 516 10 Operating liabilities 1.128 1.280 1.209-71 Financial liabilities 3.910 3.421 3.617 196 Balance sheet total 11.935 12.318 12.555 237 Net Debt (excl. puttable Minorities) 3.545 3.081 3.322 242 Gearing 70,1 % 52,5 % 55,5 % Slide 21-09.05.2007
Maturity Profile Net Debt as per 31 March 2007 M 1600 1400 1200 1000 800 600 400 200 0 1 year 2 year 3 year 4 year 5 year 6 year 7 year 8 year 9 year 10 year > 2014 Rec. Adj Benchmark Bonds (09/10) Net Debt (ex bond) Slide 22-09.05.2007
Net Debt Composition as per 31 March 2007 Slide 23-09.05.2007
Flexible Funding Structure as per 31 March 2007 Slide 24-09.05.2007
Contents Overview Key figures Results per Group area Financial report Outlook Slide 25-09.05.2007
Strategy for long-term success Expansion of the cement business in growth markets Increased vertical integration of aggregates and ready-mixed concrete in mature markets Management focus on efficiency increase and cost leadership Long-term growth due to social responsibility and environmental precaution: energy efficiency, preservation of raw material resources and climate protection Slide 26-09.05.2007
Global economy 2007 GDP growth forecast Russia: 6.3% USA: 2.3% EU-16: 2.6% Germany: 2.4% new EU countries: 5.4% China: 10.0% India: 8.5% Indonesia: 5.0% Source: Spring survey Slide 27-09.05.2007
Prospects Confidence for continued upturn in the global economy Risks from development of US property market, US dollar exchange rate, energy prices and from seasonal effects in fourth quarter HeidelbergCement is focused on internal growth, consistent cost leadership and strategic investments in order to expand its international market position High impetus from European and Asian markets Stable development in North America Slide 28-09.05.2007