Holcim increased consolidated net sales, operating EBITDA and net income in 2012 despite the difficult economic environment in Europe and restructuring costs. The Holcim Leadership Journey, which is well under way across the whole group, also supported operating performance. Despite the fact that volume growth was limited, Holcim succeeded in increasing net sales by 3.9% to CHF 21.5 billion (about €17.7 billion) and operating EBITDA by 0.7% to almost CHF 4 billion. Operating profit decreased by 6% to CHF 1.
Holcim increased consolidated net sales, operating EBITDA and net income in 2012 despite the difficult economic environment in Europe and restructuring costs.
The Holcim Leadership Journey, which is well under way across the whole group, also supported operating performance.
Despite the fact that volume growth was limited, Holcim succeeded in increasing net sales by 3.9% to CHF 21.5 billion (about €17.7 billion) and operating EBITDA by 0.7% to almost CHF 4 billion.
Operating profit decreased by 6% to CHF 1.8 billion. Excluding the restructuring costs of CHF 239 million at the operating EBITDA level and CHF 736 million at the operating profit level, both figures increased on a like-for-like basis by 6.4% to CHF 4,223 million and 11.4% to CHF 2,552 million respectively.
On top of the Holcim Leadership Journey, the group achieved like-for-like growth at both operating EBITDA and operating profit level.
The company says that these results are driven by a high degree of cost awareness in production, distribution and administration.
“Also worthy of note are the successes achieved in passing on various higher costs to prices. The various streams of the Holcim Leadership Journey, which gained momentum from mid-year on, contributed on a net basis CHF 158 million to the improvements at consolidated operating profit level in the year under review. The restructuring costs also impacted group net income,” says Holcim.
“Nevertheless, it substantially increased compared to the previous year, rising by 50.4% to CHF 1 billion. Net income attributable to shareholders of Holcim Ltd increased to CHF 622 million.”
In the fourth quarter of 2012, Holcim experienced “positive volume developments for cement; net sales increased, and adjusted operating EBITDA and operating profit increased.”
In Holcim’s outlook for the current year the current year, it expects better demand for cement; the Leadership Journey will gain further momentum, and it anticipates significant growth at operating EBITDA and operating profit level.
The company says that better demand for building materials in the fast growing markets of Asia and Latin America as well as North America was in contrast to the low demand in debt and recession-hit Europe in 2012.
“Once again, Holcim delivered more cement, with consolidated volumes of 148 million tonnes representing an increase of 2.5%. The strongest volume growth was achieved in North America, followed by Asia and Latin America. However, shipments decreased in group region Europe due to the crisis and in the region Africa Middle East due to the political instability,” says Holcim.
“Aggregates sales volumes, which are primarily supplied in mature markets, decreased by 7.7% to 159.7 million tonnes, and deliveries of ready-mix concrete recorded a drop of 3.1% to 46.9 million m³, despite an increase in North America.
“In the fourth quarter, cement deliveries increased 1.1 percent to 36.6 million tonnes.
“Aggregates sales volumes remained below the previous year’s level, dropping by 7.6% to 39.4 million tonnes. In the ready-mix concrete business, shipments fell in all group regions, with the exception of North America, in total declining by 7.2% to 11.3 million cubic meters.”
During the year management faced challenges posed by the economic crisis in Europe throughout the year, and to be able to make the necessary adjustments quickly and smoothly, the organisation of group region Europe was streamlined. It is now headed by a single executive committee member, together with three area managers.
