24 , March , 2022
HeidelbergCement has recently forecasted a negative hit to its business in 2022 due to a steep rise in energy costs amid Russia's invasion of Ukraine. Like steel and chemicals, cement production is among the more energy-intense manufacturing processes, making power costs a key factor in determining whether companies can hit their profit goals.
“The prices for energy have increased drastically within a few days, and the further development cannot be predicted at present,” HeidelbergCement stated in its annual report.
“Due to the currently very volatile impacts on the energy markets, the Managing Board assumes a negative effect also on the key performance indicators,” it stated.
Shares in the company, which also unveiled a 2021 dividend proposal of 2.40 euros per share, were 1.4% lower at the bottom of Germany's benchmark index.
The company still confirmed its 2022 outlook, forecasting a significant rise in sales as well as a slight increase in the result from current operations before consolidation and exchange rate effects.
However, it cautioned that it was currently impossible to provide a “reliable forecast of our operating business activities,” citing the lack of clarity on how the Ukraine crisis will develop.
(WITH INPUTS TAKEN FROM REUTERS)
