Results as of June 30, 2010
Christel des Royeries
Laurence Le Gouguec
The Board of Directors of Lafarge, chaired by Bruno Lafont, met on July 29, 2010 and approved the accounts at June 30, 2010. Further to their limited review of the condensed half-year consolidated financial statements of Lafarge, the auditors have established a report which is included in the half-year financial report.
|(€m)||Second quarter||First half|
|Current operating income||796||836||5%(3)||1,131||1,072||-5%(3)|
|Operating margin (%)||18.2%||18.8%||60 bps||14.2%||13.9%||-30 bps|
|Net income Group share||387||329||-15%||370||393||6%|
|Net income Group share - Excluding one-off items (1)||
|Earnings per share (€) (2)||€1.45||€1.15||-21%||€1.51||€1.37||-9%|
|Earnings per share (€) (2) - Excluding one-off items (1)(2)||
|Free cash flow||1,128||577||-49%||875||491||-44%|
|Group net debt||15,388||15,160||-1%|
(1) Excluding net capital gains on sale of Cimpor investment in 2010 and adjustment of legal provision for the German cement case in Q2 2009.
(2)Basic average number of shares increased in April 2009 due to the rights issue completed by the Group. Basic number of shares outstanding of 266.9M and 245.7M for the second quarter and first half ended June 2009, respectively, compared to 286.1M for both the second quarter and first half ended June 2010.
(3)On a like for like basis, sales decreased 2% for the quarter and 4% year-to-date and current operating income was stable for the quarter and decreased 9% year-to-date.
Current operating income
|(€m)||Second quarter||First half|
|Aggregates & Concrete||95||95||0%||31||23||-26%|
Highlights by business
- Sales were up 1% in the quarter and down 4% year-to-date, reflecting the impact of lower volumes partially offset by the stronger benefit of foreign exchange in the second quarter.
- Volume declines slowed from -5% in Q1 to -4% in Q2 on a like for like basis, reflecting a return to volume growth of 10% for North America in the second quarter.
- Volumes in emerging markets were -6% for the quarter and -5% for first-half on a like for like basis due to market downturn in Eastern Europe and some new capacities in Middle East Africa.
- Pricing remained stable overall.
- Cost reduction program strongly benefited all regions.
- EBITDA margin grew 110 basis points to 32.7% in the quarter and was stable year-to-date.
- Current operating income up 3% in the quarter thanks to developed markets returning to income growth and favorable foreign exchange, but down 6% year-to-date due to lower overall volumes.
Aggregates & Concrete
- Sales moved up 1% in the quarter due to volume growth for aggregates and slower rates of volume decline in the ready mix concrete business and were down 6% year-to-date.
- EBITDA margin was stable both year-to-date and in the quarter.
- Current operating income was stable in the quarter, reflecting the impact of strong cost reduction measures.
- Sales were up 10% in the quarter and up 4% year-to-date as volume growth compensated for lower pricing.
- Current operating income was slightly higher for the quarter and first half, benefiting from higher volumes and the strong impact of cost reduction in all regions.
Investments, divestments and liquidity
- Investments totaled €718 million in first half 2010, compared to €884 million in first half 2009.
- Sustaining capital expenditures decreased by 14% to €116 million in 2010.
- Internal development capital expenditures were down 19% to €550 million in 2010.
- Acquisitions were €52 million in H1 2010, slightly below last year.
- In the first half, Lafarge received €105 million in cash for divestments and in total has secured €350 million to date.
- As of June 30, 2010, the Group had €3.8Bn in committed credit lines with an average maturity of 2.5 years in addition to €2.8Bn of cash on hand. All Lafarge SA long-term debt obligations due in 2010 have been refinanced and extended for three to eight years as of July 30, 2010. There are no financial covenants on debt at the Lafarge SA level.
There will be an analyst conference call at 11:30 CEST, on July 30, 2010 hosted by Jean-Jacques Gauthier, Chief Financial Officer. The presentation will be made in English with slides that can be downloaded from this website.
The presentation may followed be via teleconference:
- Dial in number (France): +33 (0)1 70 99 42 72
- US dial in number: +1 212 444 0481
- International dial in number: +44 (0)20 7138 0825
Please note that a conference call playback will be available from July 30, 2010 to August 9, 2010 online through this website or at the following numbers:
- France playback number: +33 (0)1 74 20 28 00 (code: 4987425#)
- US playback number: +1 347 366 9565 (code: 4987425#)
- International playback number: +44 (0)20 7111 1244 (code: 4987425#)
Notes to editors
Lafarge is the world leader in building materials, with top-ranking positions in all of its businesses: Cement, Aggregates & Concrete and Gypsum. With more than 78,000 employees in 78 countries, Lafarge posted sales of Euros 15.9 billion in 2009.
In 2010 and for the sixth year in a row, Lafarge was listed in the ‘Global 100 Most Sustainable Corporations in the World'. With the world's leading building materials research facility, Lafarge places innovation at the heart of its priorities, working for sustainable construction and architectural creativity.
This release may contain forward-looking statements. Such forward-looking statements do not constitute forecasts regarding the Company's results or any other performance indicator, but rather trends or targets, as the case may be. These statements are by their nature subject to risks and uncertainties as described in the Company's annual report available on its Internet website (www.lafarge.com). These statements do not reflect future performance of the Company, which may materially differ. The Company does not undertake to provide updates of these statements.
More comprehensive information about Lafarge may be obtained on its Internet website (www.lafarge.com), under Regulated Information.