LafargeHolcim announced a rise in like-for-like sales of cement in 1Q18, driving a like-for-like increase in net sales. Earnings were down however, impacted by the long winter in North America and Europe.
Cement volumes totaled 47.7 million t, a 3.2% increase on like-for-like sales in 1Q17. Volumes were down in the company’s aggregates and ready-mixed concrete businesses. Net sales were CHF5.83 billion, an increase of 3.1%, while earnings were CHF700 million, a fall of 7.7%.
“Broadly, the underlying market trends seen at the end of 2017 continued into the first three months of 2018,” the company said.
“Latin America continued its positive development with top and bottom line growth. In North America, the Group is well positioned to take advantage of good market conditions despite the effect of a particularly harsh winter. Strong performance in China and India contributed to growth in the Asia Pacific region,” the company continued.
Cement volumes were up 4.2% on a like-for-like basis in Asia Pacific at 22.4 million t, accounting for 46.96% of the company’s total cement sales volumes. Latin American volumes were up significantly, rising 10.2% on a like-for-like basis to 6 million t.
North American volumes were down slightly, falling 1.3% on a like-for-like basis to 3.2 million t.
“In contrast, Middle East Africa underperformed with challenging conditions in some markets. In Europe, where underlying demand was good, first quarter performance reflected adverse weather, fewer working days and higher maintenance activity in preparation for high season growth.”
Despite the winter weather and early Easter holidays, European cement sales were down only 1% on a like-for-like basis, totalling 8.1 million t. The Middle East Africa business also recorded a 1% fall in cement volumes, selling 9 million t of cement over the quarter – but saw significant falls in aggregates and ready-mixed concrete volumes. Like-for-like sales of aggregates were down 23.7%, while like-for-like ready-mixed concrete volumes were down 23%.
The company also confirmed its targets for 2018, forecasting net sales growth of between 3% and 5%. Growth is expected across the Americas, in China and India, as well as in most areas of Europe.
Southeast Asia is expected to show positive demand, although market conditions will be challenging, while the Middle East Africa will continue to be affected by challenging markets.
“1Q18 was a good start to the year,” concluded Jan Jenisch, Group CEO. “The continued growth in the top linen is encouraging and confirms the positive outlook for our businesses. Though the quarter was affected by several headwinds, we expect the strength of our portfolio and the benefits of our new strategy to become increasingly visible over the full year. That makes us confident we will deliver on our 2018 targets.”
Read the article online at: https://www.worldcement.com/europe-cis/16052018/lafargeholcim-cement-volumes-drive-1q18-sales-growth/
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