Lafarge and Ciment Français release Q3 results

Lafarge and Ciment Français have both recently released their Q3 results, which show double digit declines in sales and revenues. However, both Groups have also made headway in reducing debt.

Lafarge

Sales

Total sales in this quarter dropped by some 20% y/y to €4252 million, impacted by the decline in demand across most markets. Cement sales were down 16% in the quarter and 12% in the year-to-date, largely due to poor conditions in Europe and North America. The key markets of Asia, Africa and the Middle East maintained solid growth.

Operating income

Across the Group, current operating income is down 28% (to €852 million) this quarter and 29% for the year-to-date. The cement sector has witnessed a 19% decline in this quarter (to €746 million) thanks to a reduction in sales and the impact of negative foreign exchange.

Investments and divestments

Lafarge’s investments in the first nine months of 2009 totalled just €1208 million compared with €10 839 million in 2008. In this same time period, the Group has announced total divestments of almost €800 million.

Ciment Français

Sales

Cement and clinker sales were down 10.6% in the first nine months of the year, particularly in mature markets. The aggregates business was worse affected, declining 19.7% to 29.6 million t, and the ready-mix concrete saw a similar decline at -21.6% to 8.4 million m³.

Revenues

Consolidated revenues decreased 11% to €3236 million. Geographically, the ‘Eastern Europe and Southern Mediterranean Rim’ region proved most successful, seeing an increase in revenues thanks to strong growth in Egypt and moderate growth in Morocco. Turkey and Bulgaria experienced significant decreases in revenues, as did Western Europe, North America and the company’s trading division. Growth in China and Kazakhstan balanced out declines in Thailand and India, making the downturn in revenues less obvious in Asia.

Recurring EBITDA fell 11.2% to €720.9 million. Operating costs have been reduced significantly. Cost savings resulting from lower fuel costs materialised in Q3, and the Group continued to feel the benefits of other projects to save money and increase efficiency. Ciment Français has also reduced its net financial debt from €1858.5 million to €1659.5 million.

Outlook

Lafarge expects that government stimulus plans, plus the slow improvement of the global economy, will lead to more positive results in the second half of 2010.

Ciment Français is anticipating a decrease in operating profit this year, if the trend of the first nine months continues. The Group’s Q3 statement does not indicate its market expectations beyond the end of this financial year.

Read the article online at: https://www.worldcement.com/europe-cis/09112009/lafarge_and_ciment_fran%C3%A7ais_release_q3_results/