04:35 PM - Board of Directors approves first quarter 2019 consolidated results

PRESS RELEASE

Cementir Holding: the BoD approves first quarter 2019 consolidated results

•Revenue: EUR 264.4 million (EUR 242.3 million in the first quarter 2018)

•EBITDA: EUR 33.7 million (EUR 24.1 million in the first quarter of 2018)

•Loss before taxes of EUR 0.3 million (EUR 7.2 million profit in the first quarter of 2018)

•Net financial debt: EUR 416.4 million (EUR 255.4 million as at 31 December 2018)

•Performance and financial targets confirmed for the current year

Rome, 9 May 2019 - The Board of Directors of Cementir Holding SpA, chaired by Francesco Caltagirone Jr., today examined and approved consolidated results for the first quarter of 2019.

Financial highlights

(Euro millions)	1st Quarter	1st Quarter	Change
2019	2018	%
Revenue from sales and services	264.4	242.3	9.1%
EBITDA	33.7	24.1	39.7%
EBITDA/Revenue from sales and services %	12.7%	9.9%
EBIT	7.8	6.3	23.6%
Net financial income (expense) and share of net profits of	(8.1)	0.9	n.m.
equity-accounted investees
Profit (loss) before taxes for the period	(0.3)	7.2	n.m.

Sales volumes

('000)	1st Quarter	1st Quarter	Change
2019	2018	%
Grey and white cement (metric tons)	1,819	2,079	-12.5%
Ready-mixed concrete (m3)	902	1,140	-20.9%
Aggregates (metric tons)	2,238	2,179	2.7%

Net financial debt

(Euro millions)	31-03-2019	31-12-2018	31-03-2018
Net financial debt	416.4	255.4	387.1

Cementir Holding SpA

200, corso di Francia 00191 Rome, Italy

T[phone] cementirholding.it

VAT number 02158501003 Commerce Administrative and Economic Index [C.C.I.A.] Rome 160.498

Share Capital EUR 159,120,000 fully paid in Tax code 00725950638

Group employees

31-03-201931-12-201831-03-2018

Number of employees

3,063

3,083

2,984

"The first quarter of 2019 closed with an increase in EBITDA and EBIT compared to the first quarter of 2018, a result of the consolidation of the US company Lehigh White Cement and the improved results in all regions except Turkey and, to a lesser extent, Malaysia" commented Francesco Caltagirone Jr, Chairman and Chief Executive Officer.

In the first quarter of 2019 cement and clinker volumes reached 1.8 million tons, down by 12.5% (-19.9% on a like-for-like basis1), due to the negative performance in Turkey which was partially offset by the performance in the Nordic & Baltic region and in Belgium.

Ready-mixed concrete volumes reached 0.9 million cubic metres, down 20.9% due to the drop in Turkey and to a lesser extent in Belgium and France, despite the good performance in Norway and Sweden. Aggregates volumes reached 2.2 million tons, up by 2.7% thanks to the positive performance in Denmark. Group Revenue reached EUR 264.4 million, up 9.1% compared to EUR 242.3 million in the first quarter of 2018 (-4.5 on a like for like basis). This increase is due to LWCC consolidation, the good performance in the Nordic & Baltic region (+13%), Belgium (+7%) and Egypt (+113%), partly offset by the negative performance in Turkey due to the widely known economic situation. At constant 2018 exchange rates, revenue would have reached EUR 268.1 million.

Operating costs of EUR 238.0 million were up on the first quarter of 2018 (EUR 228.1 million) due to the change in the consolidation perimeter (EUR 32.2 million).

The cost of raw materials was EUR 105.5 million, up by 2.5% compared to the first quarter of 2018 (EUR

102.9million) due to the change in the consolidation perimeter (EUR 19.1 million). On a like-for-like basis, raw material costs fell by 16%.

Personnel costs were EUR 47.5 million, up by 9.2% compared to the first quarter of 2018 (EUR 43.5 million) due to LWCC consolidation (unchanged on a like-for-like basis). The positive exchange rate effect offset the impact of inflation in almost all countries.

Other operating costs, totalled EUR 85.0 million, a 4.0% increase compared to EUR 81.7 million in the same period of 2018 due to LWCC consolidation (-7.5% on a like-for-like basis). They also benefited from a positive exchange rate effect of EUR 1.5 million.

1The scope of consolidation for the first quarter of 2019 changed compared to the same period of 2018, following the acquisition of an additional 38.75% stake in Lehigh White Cement Company (hereinafter "LWCC"), closed on 29 March 2018. With this acquisition, Cementir owns 63.25% of LWCC and consolidates the company on a line-by-line basis from

1April 2018.

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EBITDA reached EUR 33.7 million, up 39.7% on EUR 24.1 million in the first quarter of 2018 (+24.4% on a like for like basis). The result was positively affected by LWCC which contributed EUR 3.7 million and the improvement across all regions except Turkey and to a lesser extent Malaysia.

The impact of IFRS 16 introduction was EUR 5.9 million.

At constant exchange rates compared to last year, EBITDA would have been EUR 32.7 million, up 35% compared to the first quarter of the preceding year.

Taking into account EUR 25.9 million of amortisation and depreciation and to a negligible extent write- downs and provisions (EUR 17.8 million in the first quarter of 2018), EBIT reached EUR 7.8 million (EUR

7.3million on a like-for-like basis) compared to EUR 6.3 million in the same period last year. At constant exchange rates EBIT would have been EUR 6.4 million.

The share of net profits of equity-accounted investees (Associates) was EUR -0.2million (EUR 0.4 million in the same period of 2018, including LWCC).

Net financial expense was EUR 7.9 million compared to an income of EUR 0.5 million in the same period of the previous year. This was due to the negative mark-to-market valuation of some financial instruments used for currency and interest rate hedging as well as the yield on cash held by the Group. It should be noted that the first quarter of 2018 benefited from a Euro 10 million positive impact from the above mentioned financial instruments.

Loss before taxes was EUR 0.3 million (EUR 7.2 million profit in the first quarter of 2018).

Net financial debt as at 31 March 2019 reached EUR 416.4 million, an increase of EUR 161.0 million compared to EUR 255.4 million as at 31 December 2018, due to the cyclical nature of working capital and around EUR 78.9 million impact of IFRS 16 introduction.

Total equity at 31 March 2019 was EUR 1,129.2 million (EUR 1,128.4 million at 31 December 2018), not including taxes on earnings for the period.

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Performance by geographical area

Nordic & Baltic

	(EUR'000)			1st Quarter			1st Quarter			Change
			2019			2018			%
Revenue from sales		128,566			113,849		12.9%
	Denmark		83,327			74,073		12.5%
	Norway / Sweden		45,133			39,607		13.9%
	Other (1)
		11,971			10,571		13.2%
	Eliminations		(11,875)			(10,402)
EBITDA		19,844			12,794		55.1%
	Denmark		16,170			11,939		35.4%
	Norway / Sweden		3,371			(19)			n.s.
	Other (1)		303			874		-65.3%
EBITDA Margin %		15.4%			11.2%
Investments		7,204			7,904

(1)Iceland, Poland, Russia and white cement operating activities in Belgium and France

Denmark

In the first quarter of 2019, revenue totalled EUR 83.3 million, up 12.5% thanks to the increase in total volumes of cement sold (+10%) whereas ready-mixed concrete volumes were stable compared to the same quarter of last year.

Domestic grey cement volumes increased substantially because of ready-mixed concrete and prefabricated sectors increased market activity; good weather conditions; more working days because the Easter holidays took place in April rather than in March as was the case in 2018. Domestic white cement volumes grew by the same amount. Average domestic sales prices (for grey and white) rose slightly, in line with inflation.

Exports of white cement performed well while grey cement exports dropped (-12%). Average export prices increased thanks to both country/customer mix and favourable exchange rates.

Ready-mixed concrete volumes were in line with the same period of 2018 as the segment benefited less from the good cement market performance. Important projects are expected to start in the second half of the year, with prices rising above inflation. EBITDA reached EUR 16.2 million, up by approximately EUR 4.2 million compared with the same period of 2018.

Higher fuel costs on the international market were offset by production efficiencies, while fixed costs were affected by higher maintenance costs. The latter were also caused because of maintenance taking place in a different period compared to last year.

Norway and Sweden

In Norway, sales volumes of ready-mixed concrete increased mainly as a result of higher demand in some areas, a relatively mild winter and a dynamic and competitive market for the launch of major infrastructure projects. These projects will continue in the second half of the year. Average prices in local currency are rising above inflation.

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In Sweden, ready-mixed concrete and aggregates sales volumes increased compared to 2018, mainly because of good weather conditions and a very solid construction market, especially in the residential sector; in this regard, a slight contraction is expected in the second half of the year, especially in the ready-mixed concrete sector, also due to strong competition.

In the infrastructure sector volumes are benefiting from some major projects; further projects are slated to begin in the coming months, underpinning current volumes. Ready-mixed concrete and aggregates average prices in local currency increased in the period, due to better product mix.

Overall, revenue reached EUR 45.1 million, up by 14%, and EBITDA was approximately EUR 3.4 million, compared with a marginally negative figure in the first quarter of last year. The increase is linked to the positive trend in Norway with higher sales volumes, higher sales prices and savings on fixed production costs; and in Sweden for the positive effect of higher volumes and sales prices, net of the increase in variable costs and fixed costs.

It should be noted that the Swedish krona and the Norwegian krone average exchange rate versus the Euro fell by approximately 4.5% and 1%, respectively compared to the first quarter of 2018.

Belgium and France

	(EUR'000)			1st Quarter			1st Quarter			Change
			2019			2018			%
Revenue from sales		59,680			55,778		7.0%
EBITDA		9,372			4,536		106.6%
EBITDA Margin %		15.7%			8.1%
Investments		4,903			2,529

In the first three months of 2019 grey cement sales volumes grew by 7% compared to the first quarter of 2018 because of: better weather conditions, more working days due to Easter holidays and sales in The Netherlands.

Average prices in the domestic market were higher than in the first quarter of 2018, while export prices were also higher, but to a lesser extent due to worse product-mix.

Ready-mixed concrete sales volumes were down however, partly due to strong price competition. Aggregates sales volumes contracted very modestly compared to the first quarter of 2018; despite good weather conditions and good performance of prefabricated elements in Belgium, as well as asphalt sales increase in The Netherlands, comparable 2018 figures had been extraordinarily favourable. In France, there was a slowdown in the road construction segment. Prices on the domestic market moved upwards, while export prices were in line with the first quarter of 2018.

On the whole, first quarter 2019 revenue reached EUR 59.7 million (EUR 55.8 million in the first quarter of 2018) and EBITDA reached EUR 9.4 million (EUR 4.5 million in the first quarter of 2018). The effect is mainly attributable to the cement business thanks to higher volumes and prices, savings on variable costs and lower maintenance compared to the first quarter of 2018.

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