Italian cement maker Italcementi said on Friday it expected significant price rises to help offset swelling energy costs in the second half of 2011, after a 15 percent fall in first-half core earnings.
Like larger European peers such as France's Lafarge , Italcementi suffers as rising raw material prices push up costs. At the same time, weak demand makes it difficult to pass on price increases to customers.
First half earnings before interest, taxes, depreciation, and amortisation (EBITDA) was 372.1 million euros ($531.5 million), against an I/B/E/S mean forecast of 382.4 million.
"The second half of the year should present a significant recovery in sales prices in some countries, including Italy, to absorb the inflationary pressures generated by energy factors," Italcementi said in a statement.
The group said it expected positive performances in France and major emerging market countries to offset negative effects in the Egyptian market, where volume fell by 14.6 percent in the first six months of the year following a popular uprising there.
"Second-half operating results are expected to be comparable to those of the second half of 2010, subject to the situation in Egypt," it said.
Shares in Italcementi swung back to positive territory after the results but were down 2.4 percent by 1345 GMT, as the Milan blue-chip index extended losses to 2.1 percent.
Germany's HeidelbergCement AG reported on Friday a 6 percent decline in second-quarter operating profit, while Lafarge's operating income fell 16 percent in the same quarter, the French group said on Thursday.
Italcementi said first-half net profit reached 115 million euros, compared with 400,000 euros a year earlier, thanks to a one-off capital gain on a sale of Turkish assets.
The group's revenue rose 2.1 percent from a year ago, to 2.45 billion euros.
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