Holcim deliver solid full-year result
Operating EBITDA margin and net income increase despite difficult market conditions in 2013
HOLCIM say net sales were down 6.8% to CHF19.72 billion but increased by 0.2% on a like-for-like basis for the year ended 31 December 2013, while operating EBITDA of CHF3.90 billion compared with CHF3.89 billion the previous year. Operating profit improved by 34.8% to CHF2.36 billion in 2013, up from CHF1.75 billion, while net income rose by 59.3% to CHF1.60 billion, up from CHF1.00 billion.
Cement sales and aggregates volumes both declined by 2.4% in 2013, to 138.9 million tonnes and 154.5 million tonnes respectively, while deliveries of ready-mixed concrete fell by 12.9% to 39.5 million cubic meters and asphalt sales contracted by 2% to 8.9 million tonnes.
In the fourth quarter net sales were down 9.0% to CHF4.78 billion, but increased by 1.5% on a like-for-like basis. Operating EBITDA rose by 16.3% to CHF945 million (29.7% on a like-for-like basis), while operating profit climbed to CHF559 million, compared with a loss of CHF81 million in the fourth quarter of 2012, and net income amounted to CHF319 million after a loss of CHF91 million the previous year.
Chief executive officer Bernard Fontana (pictured) said: ‘Holcim generated a solid result in the 2013 financial year. Despite difficult market conditions, as a result of which volumes in all three segments (cement, aggregates, ready-mixed concrete) were below those recorded last year, the operating EBITDA margin and net income increased due to the consistent implementation of the Holcim Leadership Journey.’
Looking ahead, Holcim say they expect the global economies to show another year of uneven performance in 2014, with construction markets in Europe thought to have reached the bottom with a slow recovery in sight, while North American markets are expected to continue to benefit from a further recovery, especially in the US.
Latin America is expected to show slight growth in 2014, with the Asia Pacific region also growing but at a comparatively slower pace than that experienced in recent years. Africa Middle East is expected to gradually improve.
According to the company, cement volumes are likely to increase in all regions in 2014, while aggregates volumes are expected to remain flat overall with increases in Asia Pacific, Europe, North America, and Africa Middle East being offset by negative volumes in Latin America. Ready-mixed concrete volumes are also expected to increase in most regions with the exception of Europe and Latin America.
Holcim say they expect organic growth in operating profit to be achieved this year, and that their ongoing focus on the cost base coupled with the benefits expected from their Leadership Journey should lead to a further expansion in operating margins.
