Emerging markets bolster Holcim results

Swiss cement group Holcim is reporting a 10.3-percent rise in net profits to 1.1 billion francs ($1.2 billion) for the first nine months of the year, attributing this to growth in emerging markets.

Emerging markets bolster Holcim results
Photo: Holcim

Sales increased 4.8 percent over the first three quarters to 16.2 billion francs, Holcim said in a statement issued on Wednesday.

It highlighted the "advantage of a strong presence in emerging markets, where construction activity remains high."

Compared with the outcome at this time last year, the company's operating profit margin improved 0.2 percent to 19.4 percent, despite restructuring costs totalling 58 million francs in Spain, Brazil, UK, Mexico and Hungary.

By volume, cement sales increased three percent to 111.4 million tonnes over the same period in 2011, Holcim said, adding that its "geographic diversification" helped support sales in spite of the "difficult market situation in Europe."

The group, which recorded significantly higher cement sales in India, the Philippines, Indonesia, Russia, Thailand, Mexico and the United States, said it expects demand to rise in emerging markets in Asia and Latin America, as well as in Russia and Azerbaijan.

In North America, cement volumes will also increase, Holcim said. In Europe however, sales volumes are expected to decrease.

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LafargeHolcim profits shrink after merger

Swiss-based LafargeHolcim said on Wednesday that its profits collapsed as the cost of building the world's biggest cement company took its toll.

LafargeHolcim profits shrink after merger
Photos: AFP

In its first earnings report since the merger of Lafarge and Holcim was concluded in mid-year, it said EBITDA, a measure of operating profit, fell to 1.3 billion francs ($1.3 billion) in the third quarter on a comparable basis, and to 3.6 billion Swiss francs in the nine months to
September, a drop of 18.8 percent.
The nine-month results were “impacted by merger and restructuring costs, adverse foreign exchange, an economic slowdown in China and Brazil as well as softness in France and in Switzerland,” the company said in a statement.
Its performance held up well in the United States, Asia, Oceania and Latin America, it said.
The company confirmed its synergy targets from the merger, and said it was targeting a dividend of 1.50 Swiss francs per share in 2015, up from 1.30 last year.
Analysts said this pushed up the LafargeHolcim share price up by more than three percent in early Zurich trading, to 55.3 francs.