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Increase in net income for Holcim in 1Q15

World Cement,

Holcim has announced its results for 1Q15. Highlights from the group’s quarterly results are provided below.

Cement and construction materials sales

  • Cement sales volumes totalled 31.2 million t, down 5.5% on the 33 million t sold in 1Q14.
  • Aggregates volumes reached 29.5 million t, an improvement of 1.2%.
  • Ready-mix concrete volumes decreased by 2% to 8 million m3.
  • Asphalt sales volumes grew by 14.9% from 1.4 million t to 1.6 million t.

Financial results

  • Net income improved by 111.8% to CHF378 million.
  • Net sales fell by 1.6% on a like-for-like basis. Reported net sales dropped by 2.8% to CHF3.972 billion.
  • Adjusted for merger costs, operating EBITDA grew by 3.3%. Reported operating EBITDA declined by 3.9% to CHF593 million due to the merger costs and lower financial performances in Europe and Africa-Middle East.
  • Adjusted for merger costs, operating profit increased by 3.5%. Reported operating profit came in at CHF261 million, down 11.5%. This has been attributed to lower performances in Europe and Canada, as well as merger costs.
  • Net financial debt stood at CHF6.67 billion, after being reduced by CHF370 million over the last 12 months.

Holcim Leadership Journey

The Holcim Leadership Journey contributed CHF85 million to the group’s operating profit in 1Q15. Of this, CHF21 million was generated by the Customer Excellence Stream, while cost initiatives contributed CHF64 million.

Portfolio changes

  • Holcim has sold its remaining 27.5% stake in Thailand’s Siam City Cement for a total consideration of CHF661 million.
  • In January 2015, the group completed its series of interlinking transactions with Cemex in Europe.
  • In late March 2015, the Foreign Investment Promotion Board (FIPB) approved Holcim’s planned simplification of its group structure in India. The FIPB has sent the case with a recommendation for approval to the Cabinet Committee of Foreign Affairs.

LafargeHolcim merger update

  • The Board of Directors at both Lafarge and Holcim have agreed on a new exchange ratio of 9 Holcim shares for 10 Lafarge shares. Subject to shareholder approval, LafargeHolcim will announce a post-closing scrip dividend of 1 LafargeHolcim share for each 20 existing shares.
  • Eric Olsen has been named as future CEO of LafargeHolcim.
  • CRH plc will acquire a large number of the assets planned for divestment. The European Commission has cleared CRH’s purchase of these assets.

“Holcim reported robust development in the first quarter 2015, with an increase in financial performance despite a different weather pattern and some volume declines compared to a very strong previous year’s quarter. Holcim also generated higher cash flow from operating activities and increased net income significantly supported by the gain from the divestment of the Group’s minority shareholding in Siam City Cement,” commented Bernard Fontana, Holcim CEO.

Adapted from press release by

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