Press release

Dyckerhoff earnings clearly decreased as a result of price declines and write-downs in the USA; outlook 2011 cautiously positive

Wiesbaden, March 22, 2011 – In spite of harsh and snowy weather conditions at the beginning and end of the year, Dyckerhoff was able to increase the total cement volume by 5 %. The concrete volume even increased by 8 %. “These are positive signs speaking in favor of an end to the economic crisis, also in the construction industry. Typically, prices are always at the lowest level in the last year of the crisis“, commented Wolfgang Bauer, CEO of Dyckerhoff AG, at the press conference of the Wiesbaden-based company. In almost all markets the prices for cement and ready-mixed concrete declined.

Group sales are in line with the forecast: they amounted to EUR 1.4 billion, and were 3 % above the previous year’s level. Adjusted for changes to the group of consolidated companies and exchange rate variances, sales fell by 2.4 %. This is a result of price declines: increased volume could not offset price falls.

The impact on our result was accordingly perceptible: with an EBITDA of EUR 219 million, which corresponds to an EBITDA margin of 15.5 %, Dyckerhoff has not achieved its target of an EBITDA margin of 18 %.

Additionally, the result before, and after, income taxes was depressed by an essential structural improvement in the USA, were the production facilities at our Oglesby plant were “mothballed” for the foreseeable future. The unfavorable market prospects and the existing excess capacities made this step necessary. The required write-downs have a negative impact of EUR 78 million on our result before income taxes. The negative impact after income taxes is EUR 48 million.

For 2011 Bauer expects the rise in demand in Europe to continue. “Furthermore, we assume that prices for our products will increase again“, Bauer said, “Especially in Ukraine and in Russia there is good potential for strong growth. In the USA, however, I only see a change in trend within the next two years”. Against this background, Dyckerhoff expects Group sales of EUR 1.5 billion.

With regard to costs, we expect increases mainly in electricity and fuel costs. However, the shortage of electricity due to the recently resolved shutdown of the nuclear reactors in Germany will not have an effect on Dyckerhoff, since we have already bought the electricity we need. Dyckerhoff faces the unavoidable cost increases mainly by reducing the proportion of clinker by raising the share of secondary raw materials and by increasing the proportion of secondary fuels. For the fiscal year 2011, Dyckerhoff expects an EBITDA margin of around 17 % and – after depreciation and amortization being on a normal level again – a significantly increased result before, and after, income taxes.