Lafarge Q1 results impacted by harsh weather
First-quarter results affected by lower volumes reflecting overall harsh weather conditions
LAFARGE have reported a 6% decrease in sales to €3,136 million for the three months to the end of March 2013, with EBITDA down 26% to €380 million and current operating income down 53% to €124 million.
The company said the first-quarter results were affected by lower volumes reflecting overall harsh weather conditions, temporary production limitations in Algeria and Egypt and two working days less in the quarter representing a third of the volume decline.
However, performance and innovation measures continued to deliver results and generated EBITDA of €60 million and €40 million, respectively, during the quarter, despite the low volumes, and the Group says it is on track to achieve its target to generate incremental EBITDA of €650 million from performance and innovation actions in 2013.
Meanwhile, net debt at the end of March 2013 decreased by €0.6 billion compared with the first quarter of last year, although it moved slightly higher compared to year-end 2012 due to normal seasonal working capital needs.
Nevertheless, the Group says it is continuing to progress towards its debt reduction target and, with the most recent divestment of its cement plant in Ukraine, has secured €1 billion of disposals since 1 January 2012.
Commenting on the results, Bruno Lafont, chairman and chief executive officer of Lafarge, said: ‘The first quarter traditionally represents a small proportion of our results and is not indicative of full-year trends. Our outlook remains unchanged and we expect to see cement demand growth in our markets of between 1% and 4% in 2013.
‘We continued to be fully focused on actions within our control. Price increases have been actively implemented in most markets and we will reap the full benefit as the year unfolds. Our performance and innovation actions delivered €100 million EBITDA in the quarter, on track with our 2013 target of €650 million.
‘I am confident that by the end of 2014 we will have delivered most of our 2012–2015 plan to generate €1.75 billion additional EBITDA through performance and innovation measures, close to one year ahead of our initial objective. We will also reduce net debt to below €10 billion as soon as possible in 2013.’
