Heidelberg Materials (HEI) Q2 2025 earnings summary

Executive summary

• Revenue grew 4% year-over-year in H1 2025 to €10.4bn, with strong operational performance, margin expansion, and significant progress in decarbonisation and sustainability initiatives.

• Transformation Accelerator Initiative delivered €140m in savings, supporting efficiency, innovation, and margin improvements.

• Major acquisitions completed: Giant Cement (US), Asment Témara (Morocco), and Grabemaro (Morocco), accelerating growth.

• Sustainability targets upgraded, with specific net CO₂ emissions down 4% year-over-year and the launch of the world's first industrial-scale carbon capture plant in Norway.

• Outlook for 2025 confirmed, with mid-term targets raised under Strategy 2030, focusing on growth, profitability, and CO₂ reduction.

Financial highlights

• H1 2025 revenue reached €10,398m, up €404m (+4%) year-over-year; operating EBITDA rose 6% to €1,930m.

• Operating EBIT (RCO) increased 7% to €1,282m; group share profit up roughly 20% year-over-year, and adjusted EPS up 3% to €4.38.

• Free cash flow for the last 12 months at €2.3bn, with a cash conversion rate of 49%.

• Leverage stable at 1.56x; net debt at €7,197m as of June.

• Operating margin Q2: 24.2%, up 81 bps year-over-year; H1 margin: 18.7%.

Outlook and guidance

• 2025 guidance confirmed: RCO €3.25–3.55bn, ROIC around 10%, net CapEx ~€1.2bn, leverage ~1.5x.

• Slight reduction in CO₂ emissions expected; all 2030 sustainability targets upgraded.

• Confident in maintaining positive price over cost across all regions into H2, with upside potential as volumes stabilize.

• Global construction demand seen stabilising at a low level, with continued cost volatility in energy and raw materials.