LafargeHolcim pledges more asset sales

Bloomberg has reported that LafargeHolcim, under pressure to deliver on targets a year after the merger, reshuffled executives and pledged more asset sales after Q2 earnings improved on pricing.

Adjusted operating earnings before interest, taxes, depreciation and amortisation increased by 2.6% to 1.71 billion Swiss francs (US$1.76 billion). The company extended a plan to sell assets through to the end of 2017.

The shares rose 5.4% to 48.17 francs, valuing the company at 29 billion francs.

Chief Executive Officer Eric Olsen named new members to the company’s executive committee and modified regional responsibilities. Alain Bourguignon, committee member for North America, and Ian Thackwray, the member for Asia Pacific and trading, are leaving the company, LafargeHolcim said.

Olsen is still trying to deliver on profitability that was the underlying rationale for the merger. High-profile executive departures in past months further eroded investor confidence at a time when competitors such as HeidelbergCement AG are benefiting from improved demand in North America and Europe.

In the latest three-month period, the price of cement rose 2.2% quarter-on-quarter after having increased by 1.2% in Q1. Globally, volumes were down 3%.

The company kept 2016 targets, which include at least high single-digit growth in adjusted operating EBITDA. It lowered the outlook for demand growth in its markets to between 1% and 3% from between 2% and 4% and it extended a plan to sell assets to 5 billion francs by the end of 2017.

Edited from source by Joseph Green. Source: Bloomberg

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