Buzzi Unicem — Earnings Release 2023

Mar 28, 2024

2023 FULL YEAR RESULTS

28 March 2024

Pietro Buzzi – CEO

2023 IN BRIEF

Consolidated Net Sales reached 4,317 €m (+11.1% lfl), driven by solid price momentum in all Regions. Recurring EBITDA at 1,237 €m (+43.7% lfl), the highest result ever in the group history; main additional contribution from Italy, Germany and USA.

Significant improvement in EBITDA margin at 28.7% (+640bps).

Sound cash generation, although negative impact from working capital and higher capex. Positive development of ROCE over WACC spread, strengthened in 2023 despite higher cost of capital.

Dividend increased by 33% at 0.60 € ps. Share price +133% past two years.

2030 CO2reduction program on track and targets confirmed.

Commitment to the price over cost evolution in all Regions to protect margins.2024 group recurring EBITDA expected to consolidate the 2023 level.

2023 KEY FIGURES

*Recurring **Adj by non recurring items, incl. goodwill

CEMENT AND RMX VOLUMES VARIANCE

Cement volumes (mton)

Ready-mix volumes (mm3 )

NET SALES VARIANCE ANALYSIS

NET SALES AND EBITDA BREAKDOWN BY AREA

Italy's contribution to EBITDA increased thanks to resilient volumes and prices, together with lower energy costs.

Despite volume weakness, Central Europe strengthened its EBITDA contribution driven by a positive price over cost evolution. In Eastern Europe, lower contribution from Russia.

USA remained by far the biggest contributor to consolidatedEBITDA.

EBITDA BRIDGE

ENERGY COST

Total energy (ex. Russia)

Energy cost (€m)

Energy cost / Revenues*

Power & Fuel (ex. Russia)

UNITED STATES OF AMERICA

Cement demand has been resilient in H2, supported by reshoring activity and infrastructure spending. Domestic consumption is estimated to decrease by 2.9% in 2023.

• Despite the recovery in Q4, cement volumes slightly declined y-o-y, due to the generalized market slowdown as well as to some logistical criticalities along the Mississippi River.
• Pricing momentum has been able to offset inflation in fixed cost, allowing price over cost trend to improve over the year.
• Relevant growth in Net Sales and EBITDA, although the FX headwind.

ITALY

Construction activity recovered in Q4, bolstered by both NRRP and firms race to complete orders before the closure of superbonus. Domestic cement consumption estimated to decrease by 1.5% in 2023.

• Cement volumes have grown in H2, also thanks to the easy comparison with the previous year.
• Carryover effect on pricing and deflation in energy costs have significantly improved the price over cost trend, despite tax credit headwind**.
• Positive Net Sales evolution and strong EBITDA result, almost doubled compared to 2022.

*Recurring **Tax credit: 12€m in 2023 - 38€m in 2022

CENTRAL EUROPE

• Construction activity held back by residential, due to restrictive interest rates, high construction costs and reduction in public subsidies.
• Generalized downturn still affecting H2 cement and rmx volumes.
• Strong price momentum able to compensate the negative volume effect in Germany but not in Benelux.
• Improved price over cost trend over the year, despite higher energy expenses.
• Margin enhancement both in Germany and Benelux, also thanks to lower CO2 costs.

EASTERN EUROPE

Residential downturn continued to weight on construction activity in Czech and Poland. Ukraine still recovering from the easy comparison base, but the operating context remains challenging.

• Production costs worsened due to the energy component, but price over cost spread widened thanks to the solid price momentum.
• Positive development for Net Sales and EBITDA, despite the significant FX headwind weighting on Russian and Ukrainian performances.

MEXICO

Supportive domestic demand, leading cement and rmx volume to grow by 7.8% and 9.6% respectively.

• Higher prices, together with stable unitary production costs, allowed the price over cost trend to improve over the year.
• Positive development for Net Sales and EBITDA also helped by stronger MX pesos.
• Solid EBITDA margin recovery compared to the twoyear period 2021-2022.

BRAZIL

Interest rates, inflation and high level of indebtedness have continued to penalized demand in H2.

• Cement volumes slightly declined y-o-y, also affected by the first quarter heavy rains in the south-east area.
• Prices remained stable, as well as unitary production costs; EBITDA negatively impacted by change in inventory and worsened SG&A expenses.
• Modest positive FX contribution to Net Sales and EBITDA.

OUTLOOK 2024

Macroeconomic condition are still going to weight on construction investments in 2024, with subdued residential activity in all Regions; infrastructure projects are expected to support investments in Italy and USA

USA: cement demand bolstered by infrastructures spending and re-shoring activity Italy:resilientdemanddrivenbytheimplementationofPNRR

Central Europe, Poland and Czech: still subdued construction activity, due to persisting residential weakness Mexico: construction investments expected to remain in good shape thanks to near-shoring and acceleration in infrastructure Brazil: cement demand supported by public work, social housing andloosening of interest rates

Energy cost are expected to remain at high levels, despite some easiness in the fuel component

Full commitment to the price over cost evolution in all the markets

Group recurring EBITDA expected to consolidate the 2023 level

CO2 REDUCTION ON TRACK

CO2 emissions reduction in line with our roadmap.

Among main contributors:

• Reduced clinker ratio in Luxembourg (-410bps), Italy and US.
• Significant increase in thermal substitution in Italy (+640bps), Luxembourg (+850bps) and Czech Republic (+710bps).

Targets confirmed

*Roadmap perimeter excludes Russia and includes Brazil

ENVIRONMENTAL TRANSPARENCY

As part of the company's decarbonization strategy, after the validation of our CO2 emissions reduction target by the Science Based Target initiative (SBTi), in 2023 Buzzi participated in the Carbon Disclosure Project (CDP) questionnaire, receiving the B score.

In this way, the company has furthered its commitment to environmental transparency by disclosing its ecological footprint.

APPENDIX

VOLUMES

PRICE INDEX BY COUNTRY

FX CHANGES

	2 0 2 3	2 0 2 2	D	C t u r r e n
E U R 1 =	a v g	a v g	%
U S D	1. 0 8	1. 0 5	-2 7	1. 0 8
R U B	9 2. 4 6	7 3. 8 2	-2 5. 2	1 0 0. 5 9
U A H	3 9. 5 4	3 4. 0 2	-1 6. 2	4 2. 4 9
C Z K	2 4. 0 0	2 4. 5 7	2. 3	2 5. 2 7
P L N	4. 5 4	4. 6 9	1 3.	1 4. 3
M X N	1 1 9. 8	1. 1 2 9	9. 5	1 1 8. 4
B R L	5. 4 0	5. 4 4	0. 7	1 5. 4

NET SALES BY COUNTRY

	2 0 2 3	2 0 2 2	∆	∆	F o r e x	l- f- l ∆
E U Rm			bs a	%	bs a	%
l I t a y	8 1 8. 3	2 6. 2 7	9 2. 0	1 2. 7 +	-	1 2. 7 +
i d U S t t t n e a e s	1, 7 4 2. 7	1, 5 9 1. 8	1 5 0. 9	9. 5 +	( 4 6. 8 )	1 2. 4 +
G e r m a n y	8 7 2. 0	7 9 8. 8	7 3. 2	9. 2 +	-	9. 2 +
h l d L / N t u x e e r a n s	2 1 1 4.	2 2 6. 9	1 2. 8 ( )	6 -5	-	6 -5
h l k i C R / S z e c e p o v a a	2 0 4. 8	2 0 1. 2	3. 7	1. 8 +	4. 3	-0 3
l d P o a n	1 5 6. 7	1 4 1. 3	1 5. 4	1 0. 9 +	4. 8	7. 5 +
k U i r a n e	8 5. 6	5 9. 8	2 5. 8	4 3. 2 +	( 1 3. 9 )	6 6. 4 +
i R u s s a	2 8 6 4.	2 9 0. 4	8 ( 5. )	-2 0	1. 9 ( 7 )	2 2. 8 +
l im ina ion E t s	( 6 1. 3 )	( 4 0. 8 )	( 2 0. 5 )
l T t o a	4, 3 1 7. 5	3, 9 9 5. 5	3 2 2. 0	8. 1 +	( 1 2 3. 5 )	1 1. 1 +
i M ( 1 0 0 % ) e x c o	1, 0 2 5. 0	7 6 8. 5	2 5 6. 5	3 3. 4 +	9 6. 9	2 0. 8 +
l i 1 0 0 % B ( ) a r z	3 9 0 4.	0 0. 2 4	6. 2 ( )	-1 6	2. 8	-2 3

EBITDA BY COUNTRY

	2 0 2 3	2 0 2 2	∆	∆	F o r e x	l- f- l ∆
E U Rm			bs a	%	bs a	%
l I t a y	1 7 5. 2	8 2. 0	9 3. 2	n. s.	-	n. s.
i d S U t t t n e a e s	6 3 9. 1	9 4 7. 5	1 1. 6 4	2 8. 5 +	1 2 ( 7. )	3 1. 9 +
G e r m a n y	1 8 9. 1	1 2 0. 5	6 8. 7	5 7. 0 +	-	5 7. 0 +
h l d L / N t u x e e r a n s	2 8. 1	7. 0	2 1. 1	n. s.	-	n. s.
C h S l k i R / z e c e p o v a a	2. 0 7	6. 8 5	1 2 5.	2 6. 8 +	1. 5	2 1 4. +
l d P o a n	3 8. 2	2 2 7.	1 1. 0	0. 4 4 +	1. 2	3 6. 1 +
k i U r a n e	5. 6	-6 8	1 2. 4	n. s.	( 0. 9 )	n. s.
R i s s a u	9 6. 2	9 9. 6	( 3. 4 )	-3 4	( 2 4. 3 )	2 1. 0 +
d j A tm ts us en	0. 3 ( )	0. 0
l T t o a	1, 2 4 3. 2	8 8 3. 7	3 5 9. 5	4 0. 7 +	( 3 9. 7 )	4 5. 2 +
i 1 M 0 0 %	4 6 5. 5	3 0 5. 8	1 5 9. 8	5 2. 2	4 4. 0	3 7. 8
( ) e x c o				+		+
i l B ( 1 0 0 % ) r a z	8 8. 7	1 1 8. 7	( 3 0. 0 )	-2 5. 3	0. 6	-2 5. 8

CONSOLIDATED INCOME STATEMENT

	2 0 2 3	2 0 2 2	∆	∆
E U R m			b a s	%
l N S t e a e s	4, 3 1 7. 5	3, 9 9 5. 5	3 2 2. 0	8. 1 +
E B I T D A	1, 2 4 3. 2	8 8 3. 7	3 5 9. 5	4 0. 7 +
f h h, ic ing o w no n r ec ur r	5. 9	( 8. 7 )
f l i % ( ) o s a e s r e c u r r n g	2 8. 7 %	2 2. 3 %
i i d i i D t t t e p r e c a o n a n a m o r z a o n	( 2 5 8. 4 )	( 3 8 8. 9 )	1 3 0. 5
i f i O P ( E B I T ) t t p e r a n g r o	9 8 4. 8	4 9 4. 8	4 9 0. 0	9 9. 0 +
f % l o s a e s	2 2. 8 %	1 2. % 4
E i i t q e a r n n g s u y	1 6 1. 5	1 1 7. 6	4 3. 8
f i N t t e n a n c e c o s s	( 5. 4 )	( 2 3. 1 )	1 7. 7
f i b f P t t r o e o r e a x	1, 1 4 0. 9	5 8 9. 3	5 5 1. 6	9 3. 6 +
I t n c o m e a x e x p e n s e	( 1 7 4. 1 )	( 1 3 0. 5 )	( 4 3. 5 )
f i N t t e p r o	9 6 6. 8	4 5 8. 8	5 0 8. 0	n. s.
i i i M t n o r e s	( 0. 3 )	0. 0	( 0. 3 )
f C l i d d i t t t o n s o a e n e p r o	9 6 6. 5	8. 8 4 5	0 8 5 7.	n. s.

NET FINANCE COSTS

	2 0 2 3	2 0 2 2	∆	∆
E U R m			b a s	%
I t t n e e s e p e n s e r x	2 8 ( 4. )	2 6. 8 ( )	2. 1
i I t t n e e s n c o m e r	9. 6 4	2 0. 3	2 9. 2
i N t t t e n e r e s e x p e n s e	2 4. 8	( 6. 5 )	1. 3 3	n. s.
i l F ( ) o r e x g a n s o s s e s	4. 9	( 2 4. 1 )	2 9. 1
i i l i D t t e r v a v e s v a u a o n	1 ( 5. 8 )	3. 4	1 ( 9. 2 )
f f i d I t t t n e r e s c o s s o p e n s o n u n s	1 1. 0 ( )	6. 1 ( )	9 ( 4. )
h O t e r	( 8. 3 )	1 0. 1	( 1 8. 5 )
f i N t t e n a n c e c o s s	( 5. 4 )	2 3. 1 ( )	1 7. 7	6. 7 7 +
f C d b t t o s o g r o s s e ~	2. 1 7 %	1. 9 6 %

CONSOLIDATED CASH FLOW STATEMENT

E U R m	2 0 2 3	2 0 2 2
h d f i C t t a s g e n e r a e r o m o p e r a o n s	1, 0 4 9. 7	5 7 5. 4
f % l o s a e s	2 3 % 4.	1 % 4. 4
i d I t t n e r e s p a	( 3 5. 7 )	( 2 6. 8 )
i d I t n c o m e a x p a	( 1 9 5. 2 )	( 1 5 3. 9 )
h f i i i i N t t t t e c a s r o m o p e r a n g a c e s v	8 1 8. 8	3 9 4. 7
f l % o s a e s	1 9. 0 %	9. 9 %
i l d i C t t a p a e x p e n u r e s	( 3 0 3. 7 )	( 2 6 6. 7 )
i i E t t t q u y n v e s m e n s	( 7. 4 )	( 4. 1 )
f h h P t u r c a s e o r e a s u r y s a r e s	-	1 2 3. 2 ( )
i i d d i d D v e n s p a	( 8 3. 3 )	( 7 3. 5 )
d d d f D i i i i t e n s r e c e e r o m a s s o c a e s v v	8 4. 7	7 5. 8
f f i l i d d i D t t t s p o s a o x e a s s e s a n n v e s m e n s	2 2. 0	1 2. 2
f f l i d i d d i i T t t r a n s a o n e r e n c e s a n e r v a v e s	1 ( 5 7. )	1 6 5.
d i b l A t t c c r u e n e r e s p a y a e	1 1. 7	( 0. 1 )
d i I t t n e e s e c e e r r v	3 4. 7	2 0 4.
h i f l i d i d h C * t t a n g e n s c o p e o c o n s o a o n a n o e r	1 ( 0. 6 )	1. ( 9 )
h i d b C t t a n g e n n e e	5 0 9. 8	5 2. 7
f i i l i i d f i d N ( ) t t e n a n c a p o s o n e n o p e r o	7 9 8. 0	2 8 8. 2

* Includes (8.0) of Ukraine cash reclassification

NET FINANCIAL POSITION

	2 3 D e c	2 2 D e c	∆	2 1 D e c
E U R m	b a s
h d h f l C i i t t a s a n o e n a n c a a s s e s r	( 1. 2 7 1, 1 )	( 1. 3 4 9, 7 )	7 8, 5	( 1. 2 2 0, 9 )
h d b S t- t t o r e r m e	2 8 7, 3	6 2 1, 9	( 3 3 4, 6 )	2 1 4, 2
h l S i t- t o r e r m e a s n g	1 9, 7	2 0, 3	( 0, 6 )	2 1, 4
h h N t t- t e s o r e r m c a s	( 9 6 4, 2 )	( 7 0 7, 5 )	( 2 5 6, 7 )	( 9 8 5, 3 )
f i i l L -t t o n g e r m n a n c a a s s e s	( 2 3 3, 9 )	( 2 4 9, 8 )	1 5, 9	( 1 1, 0 )
d b L -t t o n g e r m e	3 4 3, 6	6 1 1, 0	( 2 6 7, 4 )	1. 1 7 3, 4
l i L -t o n g e r m e a s n g	5 6, 6	5 8, 1	( 1, 6 )	6 4, 6
f i i l i i N t t e n a n c a p o s o n	( 7 9 8, 0 )	( 2 8 8, 2 )	( 5 0 9, 8 )	1, 2 4 6
d b b k d G t r o s s e r e a o n w	7 0 7, 1	1. 3 1 1, 3

Gross debt breakdown

DEBT MATURITY PROFILE

2023 FULL YEAR RESULTS

28 March 2024

Pietro Buzzi – CEO