‘Solid’ results from Lafarge
By Sandy Guthrie25 July 2014
Construction materials firm Lafarge has experienced “another quarter of solid organic growth”, according to Bruno Lafont, chairman and CEO.
Although sales were down 5% in the second quarter to €3,367 million, the company said they rose 3% on a like-for-like basis.
EBITDA (earnings before interest, taxes, depreciation and amortization) was down 2% to €812 million, but up 9% like for like. Current operating income, stable at €609 million, was up 12% like for like.
For the first half, sales fell 4% to €6,000 million – up 6% like for like, while EBITDA was down 1% to €1,155 million – up 13% like for like. Lafarge said that current operating income was up 2% to €755 million, but up 20% like for like.
Lafont said, “Our margin improvement reflects our success in reducing costs and promoting our innovative products and solutions. We remain fully mobilised on achieving our 2014 objective to generate more than €600 million thanks to our cost cutting and innovation actions, and aim at reducing our net debt below €9 billion by the end of the year.”
He said the company confirmed its outlook of cement demand growth in its markets of between 2% and 5% in 2014.
“North America is improving, growth continues in emerging markets, and we see the first signs of recovery in Europe.
“At the same time, our planned merger to create LafargeHolcim is well on track and we confirm our expectation to complete it in the first half of 2015."
Lafarge noted that emerging markets continued to be the main driver of demand and said that it would benefit from its “well-balanced geographic spread of high quality assets”.
It felt that cost inflation would continue at a similar pace to 2013, which would result in higher prices overall.