Cement giant in reporting shock

RMC Group, the world's biggest maker of ready-mixed concrete, has stunned the City by admitting that important output figures given to analysts were overstated.

The revelations are an embarrassment for RMC, which has been trying to restore its reputation after being fined £8m by German authorities last year for its part in a European price-fixing cartel.

Though the overstatement has had no impact on headline profits, analysts rely on the numbers to help them assess a company's market share, an important indicator of the strength of a company.

Until now, RMC has included 100% of the output of joint ventures, even though it might hold only a minority stake in the businesses. While it has never made these tonnage figures available to shareholders, it has regularly provided the information to analysts who assess its performance on behalf of investors.

But in a presentation after interim results earlier this month, RMC changed the way it accounted for those volumes to bring them into line with its share of the joint ventures rather than claim the entire output.

However, it did not flag up the change in policy and one analyst said he noticed only later when comparing volume figures in the latest half-year with a year ago. He said: 'The company did not explain it had done this. It was something of a surprise to say the least.'

The group is in a recovery phase under new chief executive David Munro, who joined last January, and finance director Adrian Auer, who joined in January last year.

In the past financial year, its joint ventures recorded a turnover of £458m, out of a group total of £4.9bn, and delivered an operating profit of £17.1m from a total of £211m.

RMC said the volume figures had only ever been available to analysts and the decision to change the way they were calculated was to improve accuracy.