ZURICH, March 17 — LafargeHolcim Ltd full-year profit was in line with estimates as the world’s largest cement maker said demand is expected to grow overall in 2016 even as a slowdown in some emerging market economies like India and Brazil hurt earnings last year.
Adjusted operating earnings before interest, taxes, depreciation and amortisation fell 11 per cent to 5.75 billion Swiss francs ($5.9 billion), the Jona, Switzerland-based company said in a statement Thursday. That compared to pro-forma earnings of 6.5 billion francs (RM27.18 billion) the previous year. The figures, adjusted for merger and restructuring costs, compared to the average estimate for 5.73 billion francs of analysts surveyed by Bloomberg.
The company said it has made “significant progress” in a plan to sell assets including agreements to sell stakes in operations in South Korea and Saudi Arabia. Its merger is on track and 2018 targets are confirmed, according to the statement.
Switzerland’s Holcim Ltd. and Lafarge SA of France merged last year with the promise of more than US$1 billion (RM4.09 billion) in annual cost savings to give them an advantage over rivals amid a slowdown in demand in some markets. Chief Executive Officer Eric Olsen is seeking to sell 3.5 billion Swiss francs of assets this year including in India as part of the integration of the former competitors.
LafargeHolcim said 2015 results were affected by a slowing of economic growth in China as well as India and “strong growth” in some European markets like the UK and Romania even as other regions were hit by depressed construction markets. It sees demand growing between 2 per cent and 4 per cent this year.
A construction slowdown in markets like Brazil and the departure of executives including Chairman Wolfgang Reitzle have rattled LafargeHolcim investors. Shares have fallen 42 per cent since the combined company began trading in July compared with a 5.8 per cent drop in the Stoxx 600 Construction & Materials Index. — Bloomberg
