Sales and volumes
Lafarge’s sales came in at €4.1 billion in 2Q13 and €7.2 billion in 1H13, the latter falling by 2% on a like-for-like basis and the former remaining stable when compared to the corresponding period in 2012. Sales volumes in the second quarter of this year were impacted by poor weather conditions and a fuel shortage in Egypt. Cement sales volumes dropped from 38.4 million t in 2Q12 to 36.5 million t in 2Q13. On a like-for-like basis, cement sales fell by 4% in 1H13, coming in at 65.2 million t. Sales volumes of aggregates also declined, dropping from 84.2 million t in 1H12 to 83.8 million t in 1H13, as well as falling by 1% like-for-like in 2Q13. Around 8.3 million m3 of ready-mix concrete was sold in 2Q13 compared to 8.6 million m3 in 2Q12.
Total EBITDA fell by 3% on a like-for-like basis in 2Q13 to €922 million and dropped by 9% in 1H13. However, enhanced performance and innovation initiatives helped Lafarge to generate a total of €160 million in 2Q13, offsetting low sales volumes and a lack of carbon credit sales. These measures have generated €260 in the first half of the year, in line with the company’s plans. Lafarge aims to generate an additional EBITDA of €650 million this year by way of these performance and innovation measures.
On a regional basis, EBITDA fell by 8% like-for-like in North America in 2Q13, but increased by 17% in 1H13. In Latin America, EBITDA grew like-for-like in 2Q13 and 1H13, up by 7% and 1%, respectively. Positive results were also reported for Asia, where it increased by 16% like-for-like in 2Q13 compared to 2Q12 and by 17% in 1H13. Western Europe did not fare so well, with EBITDA falling 14% like-for-like in 2Q13 and by 38% in 1H13. Similarly, in Central and Eastern Europe, EBITDA was down 21% on a like-for-like basis in 2Q13 and declined by 48% in 1H13 compared to 1H12. Finally, in 2Q13, EBITDA for the Middle East and African region dropped 1%, while falling by 10% like-for-like in 1H13.
Net debt reduced
By the end of June 2013, net debt had been reduced by €0.7 billion from June 2012. The Group plans to decrease net debt to below €10 billion this year and below €9 billion in 2014.
“Our results in the second quarter resisted in an environment which was marked by a conjunction of unfavourable circumstances. We increased prices and performance and innovation results are in line with our 2013 €650 million additional EBITDA target,” said Bruno Lafont, Lafarge Chairman and CEO. “Taking into account first-half volumes, we foresee a cement demand growth in our markets of between 0 to 3% in 2013, which implies more positive trends in the second half,” he added.
“We are fully mobilised to deliver on our strategy which objective is to create sustainable value for our shareholders. This means focusing on actions within our control, including through performance and innovation. Creating value also means we will continue the utmost discipline in terms of capital allocation as well as pursuing our portfolio optimisation. And it starts with strengthening our financial structure, which means to be back to an investment grade status as quickly as possible, reducing net debt below €10 billion in 2013 and below €9 billion in 2014.”
Adapted from press release by Louise Fordham.
Read the article online at: https://www.worldcement.com/europe-cis/26072013/lafarge_group_results_2q13_1h13_70/