Lafarge Q3 sales rise; upbeat on growth
By Helen Wright09 November 2010
Lafarge reported a +6% rise in third quarter revenue to € 4,5 billion, against last year's quarterly sales of € 4,2 billion, and said there were early indications of market improvements in Europe.
But the building materials giant saw net profitability drop to € 460 million in the third quarter, compared to € 496 million over the same period in 2009.
And Lafarge's nine-month figures echoed this fall - net income dropped to € 969 million from € 1,0 billion in 2009, while revenues for the nine-months ended 30 September were flat year-on-year at € 12,2 billion.
The company said that, based on demand trends seen through during the third quarter, it will maintain its overall growth estimates in its markets. Lafarge expects cement market demand to be between -1 to +3% in 2010.
While the strongest growth is expected in emerging markets, Lafarge also noted, "The first signs of market improvements in Central and Eastern Europe since mid-2008," during the quarter.
In Western Europe, the UK market continued to improve on the back of major infrastructure projects, while Lafarge also saw positive volume trends in France during the second and third quarters. By contrast, Spain and Greece, "Continued to suffer from the financial crisis and reduction of public spending."
Chairman and CEO, Bruno Lafont, described Lafarge as having "held up well" in the third quarter, thanks to a balanced portfolio and "the operational efforts of all our business units."
"This occurred despite of a significant recovery in developed markets," he added.
Looking ahead, the company expects overall pricing to remain solid through the year.
And while Lafarge remains prudent on mature market trends in 2011, it expects to benefit from "solid growth" in emerging markets next year.
"As seen in recent years, these markets will continue to drive cement demand as urbanisation, demographics and infrastructure needs result in higher rates of construction," it concluded.