HeidelbergCement – Annual General Meeting

On Wednesday, 7 May 2014, at the Kongresshaus Stadthalle Heidelberg, Germany

In his speech to about 240 shareholders, Dr. Bernd Scheifele, Chairman of the Managing Board, offered a look back at HeidelbergCement’s successful development in 2013. Despite the continuing difficult and volatile economic environment, HeidelbergCement developed well and met important objectives of the financial year 2013. As announced, especially profit for the financial year and earnings per share were increased significantly. Basis for this positive development was a further improvement of the operating business thanks to increases in sales volumes in cement, successful price increases in major markets, the consequently implementation of the “FOX 2013” programme, which significantly surpassed the original saving goals also in its final year. Furthermore, HeidelbergCement achieved a balanced additional ordinary result whereas in the previous year profit for the financial year was impacted by high non-recurring effects.

In the beginning of 2013, HeidelbergCement used the improved business development for investments in organic growth and additionally for strategically sound and low-risk investments. HeidelbergCement increased its participation in Cement Australia from 25% to 50%, acquired the remaining 50% of the British aggregates company Midland Quarry Products, and increased the holding in the Russian cement company CJSC “Construction Materials”, Sterlitamak, to 100%. Contrary to the own objective, net debt increased to €7.5 billion at the end of the year due to the payment of a cartel fine in the second quarter and the depreciation of numerous currencies against the euro in the second half of the year. Against this background, deleveraging has the highest priority in the current financial year. One focus is the sale of the building products business line in the United Kingdom and North America, as well as other assets that do not belong to our core business.

In the last 12 month, HeidelbergCement was able to further enlarge its shareholder structure and to gain long-term interested investors as shareholders. Since the beginning of 2013, the HeidelbergCement share developed very positive and outrun both DAX and MSCI Construction Materials Index. Since the beginning of 2014, the HeidelbergCement share is amongst the strongest DAX values.

Outlook confirmed for 2014

Dr. Scheifele also reported on the results and developments in the first quarter of 2014, reconfirming HeidelbergCement’s outlook for the remainder of the year as presented at the press conference on 2013 results in March 2014. HeidelbergCement will continue its efforts to improve margins and reduce net debt, while maintaining its strategy of targeted investment in cement capacity in growth markets. Revenue, operating income, and profit for the financial year should increase in 2014 on a comparable basis, i.e. adjusted for exchange rate and consolidation effects as well as non-recurring effects. “As one of the biggest building materials producer worldwide, we will exploit our entrepreneurial potential and our dynamic to benefit over-proportionally from the accelerating economic growth in the interests of our shareholders,” says Dr. Bernd Scheifele.

Dividend increased by 28%

The Annual General Meeting has approved the proposal of the administration to increase the dividend by 28% to €0.60 with a substantial majority of 99.81%. “With the increase of the dividend, we want our shareholders to participate in the overall very successful business development in 2013,” explains Dr. Bernd Scheifele. “In the beginning of 2013, we promised to create more value for our shareholders. As announced, we were able to increase earnings per share significantly.”

Shareholder representatives of the Supervisory Board elected

Furthermore, the Annual General Meeting has elected the shareholder representatives of the Supervisory Board. The shareholders have approved the proposal of the administration with a substantial majority. Besides the current members of the Supervisory Board Messrs Fritz-Jürgen Heckmann, Ludwig Merckle, Tobias Merckle, Alan Murray, and Mrs. Univ.-Prof. Dr. Marion Weissenberger-Eibl, Dr. Jürgen M. Schneider has been elected as new member of HeidelbergCement’s Supervisory Board. Dr. Schneider succeeds Mr. Max Dietrich Kley, who has reached the standard retirement age and made his mandate available after today's annual general meeting.

Changes to the Managing Board remuneration system approved by a large majority

The Annual General Meeting has approved the changes to the Managing Board remuneration system introduced on 1 January 2011 with a substantial majority of more than 97.5% confirming the increase of the variable share of the total remuneration and the significant strengthening of the multi-year assessment effective since 1 January 2014. “We are pleased, that the changes to the Managing Board remuneration system and the description in our Annual Report were received very positively by our shareholders,” says Dr. Scheifele. “This is also proof of our good understanding of investor needs and the professional communication on the capital market.”

Of the company’s € 563.7 million in subscribed share capital, 73.18% were represented.

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