LafargeHolcim beats targets

Fourth quarter sales were said to be up 5.1% on a like-for-like basis, which was the same figure for the year.

Jan Jenisch, CEO, said, “Our momentum accelerated in the second half of 2018, during which we exceeded our sales targets while profitability increased over-proportionally.

“We completed a very successful 2018 with a double-digit EPS (before impairment and divestments, attributable to shareholders) growth and progressed significantly towards our deleveraging target.”

He said he was proud of the fast roll-out of the company’s Strategy 2022 – Building for Growth.

“We are well-positioned and I am expecting a further acceleration of our growth and earnings dynamic in 2019.”

Net sales growth was said to be driven largely by higher cement volumes, with net sales reaching CHF27.47 billion (€24.17 billion).

It said recurring EBITDA (earnings before interest, taxes, depreciation and amortization) reached CHF6.02 billion (€5.29 billion), up 3.6% like-for-like for the full year, with the cement, aggregates and ready-mix concrete segments all said to be contributing to the outcome.

Net debt amounted to CHF13.52 billion (€11.90 billion) at the year end, which was an improvement of CHF828 million (€728.78 million) over the previous year. LafargeHolcim said this reflected the cash conversion of 28.3% and a positive impact following the classification of Indonesia’s local external net debt as held-for-sale.

Divestment

It added that its Indonesia divestment closed successfully at the end of January 2019, and that the full effect would be reflected in 2019.

It reported that the global roll out of the new Strategy 2022 – Building for Growth had started successfully. It claimed strong progress had been made in all four drivers of the strategy delivering results ahead of plan.

The company said, “Switching gears to growth is the most fundamental principle of Strategy 2022.”

Four bolt-on acquisitions were completed in 2018 in Europe and North America which drove growth and added to the company’s presence in ready-mix concrete and aggregates.

“These acquisitions had immediate impact on profitability and brought the company closer to its end-customers.”

Four more bolt-on acquisitions have been signed in 2019 in Europe, Australia and North America, it added.

In terms of simplification and performance, the closure of four corporate offices in Singapore; Miami, US; Zurich, Switzerland; and Paris, France, was completed.

LafargeHolcim said that for 2019, solid global market demand was expected, with continued market growth in North America, softer but stabilising cement demand in Latin America, and continued demand growth in Europe.

It said it expected challenging but stabilising market conditions in the Middle East-Africa region, with continued strong demand growth in Asia Pacific.