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Solid like-for-like performances for Holcim and Lafarge

Bernard Fontana

Companies report solid operating results on like-for-like basis for year ended 31 December 2014

HOLCIM have reported a 3.1% decrease in consolidated net sales to CHF19.1 billion (up 3.0% like-for-like) for the year ended 31 December 2014. Operating EBITDA was down 3.8% to CHF3.75 billon but increased by CHF215 million or 5.5% on a like-for-like basis over the same period.

Operating profit was down 1.7% at CHF 2.3 billion in 2014 but increased by CHF249 million or 10.6% on a like-for-like basis. The Group’s operating profit margin increased by 0.2 percentage points to 12.1% (up 0.9 percentage points on a like-for-like basis).

The Holcim Leadership Journey realized total benefits of CHF1.85 billion by the end of 2014, against a target of CHF1.5 billion, and contributed CHF748 million to the Group’s 2014 operating performance.

In 2014 consolidated cement sales were up 1.0% to 140 million tonnes, a like-for-like increase of 1.4%, while aggregates volumes were slightly below 2013 levels, decreasing by 0.9% to 153 million tonnes, a like-for-like decrease of 0.4%. Ready-mixed concrete deliveries declined by 6.3% to 37 million cubic metres, while asphalt volumes increased by 12.4% to 10 million tonnes.

Holcim’s chief executive officer, Bernard Fontana (pictured), said: ‘Holcim achieved solid like-for-like performance in the financial year. The Group further increased its profitability and recorded a higher operating profit margin.’

He added: ‘The Holcim Leadership Journey significantly overachieved its targets and was a key contributor to the Group’s results, building on an increased focus on customer excellence and ongoing cost discipline.’

Looking ahead, Holcim say they expect the global economy to continue its gradual recovery in 2015, with key construction markets in the US, India, Indonesia, Mexico, Colombia, the UK, and the Philippines expected to be the main growth drivers.

Meanwhile, Lafarge reported a 2.0% decrease in consolidated sales revenue to €12.8 billion (up 3.0% on a like-for-like basis) for the year ended 31 December 2014. EBITDA was down 3.0% to €2.7 billion but up 5.0% like for like. Current operating income was down 3.0% to €1.9 billion in 2014 but up 7.0% like for like.

The Group delivered its 2014 cost-cutting and innovation target, generating €600 million in the 12-month period to the end of December.

In 2014, cement sales were up 2.0% to 116.4 million tonnes, a like-for-like increase of 4%, while aggregates volumes were 2% down on the previous year at 161.4 million tonnes, a like-for-like decrease of 1.0%. Ready-mixed concrete deliveries were down 1.0% to 26.4 million cubic metres, representing a like-for-like decrease of 2.0%.

Bruno Lafont, chairman and chief executive officer of Lafarge, said: ‘In 2014, we completed our 2012–2015 cost-reduction and innovation objectives a full year ahead of schedule, supporting our solid operating results. Today, we are perfectly positioned to best benefit from upswings in any and all of our markets in an economic environment that, whilst remaining volatile, will be more favourable in 2015.’

He added: ‘2015 will also be the year of our planned merger to create LafargeHolcim, which is now only four months away. We have accomplished major steps, including the announcement of the future executive committee. We are today all fully mobilized to launch the new Group from a running start on day one.’

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