LafargeHolcim sees recovery in China
By Joe Sargent27 March 2020
Swiss materials producer LafargeHolcim said it is seeing the recovery of the Chinese construction sector first-hand with all its plants outside Hubei Province operating again following the COVID-19 outbreak.
“Currently” the company stated, “the development of the Coronavirus pandemic and its implications for the business are volatile and very different from country to country.
“While the construction sector and construction sites are generally more resilient than other sectors, LafargeHolcim is now experiencing disruptions in operations in various countries.”
The company forecast that market demand in China will further recover and expects to supply 70% of the volume of material it did in April 2019.
In other key markets it forecast significant volume declines in April and May and expects a significant negative impact in the second quarter.
In response, the company has launched an action plan - ’Health, Cost & Cash - for immediate execution in all countries. The key actions are:
- · To Reduce capital expenditure by at least CHF 400 million (€377.5 million) compared to 2019;
- · Reduce fixed costs by CHF 300 million (€283.2 million) in 2020;
- · Reduction of energy prices and full review of all third party products and services;
- · Reduction of Net Working Capital at least in line with level of activity.
LafargeHolcim said that since the beginning of the pandemic it had taken the necessary measures to protect the health of its employees, customers, suppliers and other stakeholders, and added, “We are closely monitoring all markets according to the evolving situation and to the guidance provided by the authorities in each country.”