Heidelberg Materials ETR: HEI reported first-quarter 2026 results that management described as “robust,” though significantly affected by adverse weather across several key regions, including the U.S. Northeast and parts of Europe. Chairman of the Managing Board Dominik von Achten said revenue totaled EUR 4.5 billion and recurring operating income (RCO) was EUR 0.2 billion, down versus the prior-year quarter, with the decline driven “mainly and predominantly” by weather-related volume weakness.
Despite the softer start to the year, von Achten emphasized that the company maintained “positive price over cost,” which “to a large extent mitigates the volume impact.” He also pointed to improving last-twelve-month margins across business lines, citing cement margins rising to 27.5%, aggregates to 25.7%, and the group to 21.6%.
Weather-driven volume headwinds, with April improving
Management repeatedly returned to weather as the central factor behind the quarter’s year-over-year decline, citing snow and severe conditions in Northern, Western, and Eastern Europe as well as the U.S. Northeast. Von Achten called out that the U.S. Northeast had been particularly hard hit, referencing widely reported disruptions in New York.
Looking into the second quarter, the company said conditions improved meaningfully in April. Von Achten said group volumes were “clearly above prior year and also our plan” in April, adding that the move was “significant” rather than incremental. When asked to clarify the regional picture, he said Europe was “flat” in April, but noted that was “much better than the first quarter.”
In Europe, management said the weakest demand remained concentrated along what von Achten described as an “axis” between the U.K. and Romania, with sluggishness also affecting Germany and the Benelux region. He said the rest of Europe was “actually okay,” while in Eastern Europe, Poland and Romania appeared “a little bit slower.”
In North America, CFO René Aldach said most regions were “nicely up” in the quarter, but the company’s largest region—the Northeast—was sharply lower, weighing on profitability because it is “a cement region with high margins.” Aldach said April volumes in the Northeast “went nicely up.”
In Africa and the broader AMEA segment, management cited weather impacts as well, including flooding in Morocco for the first 2.5 months of the quarter and weaker volumes in parts of North Africa and sub-Saharan Africa. Von Achten said April was significantly better, and the company stated AMEA volumes were “clearly up” in April.
Pricing and cost inflation: “value before volume”
On pricing, von Achten said Heidelberg Materials’ approach remained focused on “value before volume.” He said pricing in Europe was “intact,” with the U.K. described as “a little bit” sluggish. He also pointed to the CO2 certificate price at “EUR 75” as a factor reinforcing cost pressure, “especially for those who are short.”
In North America, von Achten said aggregate pricing was “very strong,” and cement pricing was “in positive territory.” He noted that the company had previously targeted a low single-digit cement price increase in North America and said it was “on track.”
On energy inflation, Aldach said the company’s “clear target is to fully offset the cost.” He noted that fuel, diesel, and oil represent about 15% of the company’s energy bill, and that hedging levels in 2026 were “never as high as they have been.” Aldach characterized the direct fuel and energy impact as “probably low single-digit cost increase” on the energy bill, adding that a decline in oil prices would reduce that pressure.
Transformation Accelerator, closures, and capital allocation
Von Achten said the company’s Transformation Accelerator program “has taken off,” with “more than EUR 400 million already on the clock,” and management expressing confidence it would “surpass EUR 500 million by year-end.” He also cited EUR 380 million achieved in the prior year and said the company expected “further good traction” on the cost side through 2026.
In the Q&A, Aldach said recently announced plant closures and restructuring actions would be “additional savings” on top of the original EUR 500 million target, reinforcing management’s view that the final total “will be more.” However, he cautioned that the full run-rate impact would come in 2027, with some benefit in 2026 as the company works through processes including labor considerations.
On shareholder returns, the company said it would increase its share buyback program. Von Achten said the next tranche would rise to EUR 450 million from about EUR 400 million last year, while Aldach added it would start after the annual general meeting in May and said the company remained committed to increasing shareholder returns “together with the dividend.”
M&A updates: Australia’s Mawsons and Turkey’s Akçansa
Heidelberg Materials highlighted ongoing external growth initiatives, including an acquisition in Australia and a move to a majority position in Turkey’s Akçansa.
Regarding the Australia deal (Mawsons), Aldach said the transaction was signed after the company set its guidance and remains under review by Australia’s ACCC. He said the earliest expected closing would be “late Q3, beginning of Q4.” Von Achten and Aldach said the acquisition is progressing through the antitrust process and is “on track.”
On Akçansa, von Achten said Heidelberg Materials had worked with Sabancı in a joint venture for 30 years and now has the opportunity to acquire Sabancı’s shares, taking ownership to “almost 80%.” He described the business as having underperformed in 2025 and said the company believes it can improve results through direct control and synergy capture. He also highlighted export flexibility from the Çanakkale plant, describing it as “a powerhouse when it comes to exports” serving Africa, Asia, and even North America. Aldach called it “a very, very good deal,” saying the downside risk was “very low” given familiarity with the business and management capabilities.
Both management teams said neither Mawsons nor Akçansa was included in the company’s full-year guidance, and von Achten said the timing of the Turkish antitrust process was difficult to predict.
Guidance reiterated; evoZero progress and ETS uncertainty
Heidelberg Materials reiterated its full-year outlook, confirming RCO guidance of EUR 3.4 billion to EUR 3.75 billion, ROIC above 10%, slightly reduced CO2 emissions, capex of EUR 1.2 billion to EUR 1.3 billion, and leverage around 1.5x. Aldach said the company expected to “catch something up” after the weather-affected first quarter, pointing to stronger April volumes and continued pricing momentum in North America aggregates.
Von Achten also provided an update on evoZero, saying production and integration were performing well: “We are capturing the CO2, we are storing the CO2, the carbon bank is filling.” He said the company was engaged in customer discussions across Europe and with global customers tied to European footprints, and reiterated that Heidelberg Materials is pursuing a “completely different price point” for the product. He added the company is not pressured to sell immediately because storage capacity allows flexibility “over 5 years.”
On European ETS and benchmarks, von Achten said it was difficult to forecast political outcomes, noting market pricing around EUR 75 and referencing rumors that a new benchmark could be around “650, 660.” He said he understood a decision could come in the “next couple of weeks,” but stressed the lack of a formal date and declined to speculate further on reforms.
About Heidelberg Materials ETR: HEI
Heidelberg Materials AG, together with its subsidiaries, produces and distributes cement, aggregates, ready-mixed concrete, and asphalt worldwide. It provides cement products; natural stone aggregates, including sand and gravel; crushed aggregates comprising stone chippings and crushed stones; and ready-mixed concrete for use in the construction of tunnels or bridges, office buildings, or schools, as well as to produce precast concrete parts, such as stairs, ceiling elements, or structural components.
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