HeidelbergCement, the world’s third-biggest cement maker, said third-quarter earnings jumped 9.8% as the company raised prices in North America.
Operating income before depreciation increased to $1.08bn (€866m) from €789m a year earlier, the Heidelberg-based company said today in a statement. Revenue rose 3.6% to €3.81bn. The stock gained as much as 5.9% in Frankfurt trading.
“In the third quarter, we generated the best operating income since the financial crisis started in 2008,”
chief executive Officer Bernd Scheifele said in the statement.
“Our advantageous geographical positioning, successful price increases in key markets and strict cost management have contributed to this achievement.”
HeidelbergCement is facing the prospect of a larger competitor with the proposed $40 billion merger of its two bigger rivals, France’s Lafarge and Switzerland’s Holcim. While the two companies are selling divisions representing 20% of their combined revenue in Europe, HeidelbergCement said this week it no longer plans to bid for any of the assets.
The German company is disposing of its building-products business, which makes bricks and roof tiles primarily for the UK and North American markets. It is evaluating both an initial public offering and an outright sale of the unit. HeidelbergCement said today that price increases in North America, the UK and Indonesia contributed to sales gains.
Holcim’s profit in the third quarter missed analyst estimates because of sluggish European demand, while Lafarge’s wider presence in emerging markets helped the Paris-based company beat analyst predictions.
Scheifele’s FOX 2013 three-year efficiency program, which ended last year, realized €1.2bn in savings as part of a strategy to regain an investment-grade credit rating lost in 2008 following the $18bn purchase of British cement maker Hanson. HeidelbergCement has two further projects targeted at lifting profit by €350m by 2015.